Telenor makes new move to protect Holding in VimpelCom (Norway)
Telenor ASA has launched a legal action that could potentially overturn the $6-billion acquisition of Wind Telecom by Russia’s VimpelCom Ltd. , in which Telenor holds a 40% stake.
Norway’s largest telecoms firm, Telenor is seeking an order that would require VimpelCom to issue extra shares in its favor at the same time that it issues shares for Wind, which is controlled by Egyptian billionaire Naguib Sawiris.
According to the company, it has petitioned the Commercial Court in London for an injunction that would see those shares placed in escrow until the conclusion of the arbitration proceeding that it launched Jan. 28.
Telenor has been at disputes with VimpelCom’s management and Altimo, a rival shareholder in the company, over the deal, which would create the world’s fifth-biggest mobile operator by subscribers.
Telenor had lost its pre-emptive rights after an Altimo shareholder purchased a stake in Egypt-based Orascom Telecom Holding, which is more than half-owned by Wind Telecom.
The purchase made the acquisition of Wind a related-party transaction, preventing Telenor and other shareholders from exercising their pre-emptive right to buy shares and counteract the reduction of their stakes in the company.
The share issue in Wind’s favor will be voted on by VimpelCom shareholders on March 17 and is set to be at the final stage of the Russian mobile operator’s troubled acquisition of heavily indebted Wind.
As per the acquisition terms, VimpelCom will pay Wind Telecom $1.495 billion in cash, while Wind will also get 325.6 million new VimpelCom common shares and 305 million new convertible preferred shares, which have voting rights.
Telenor plans to reject VimpelCom, Sawiris deal
Telenor ASA is reportedly preparing to vote against a revised deal that would merge Russia’s second-largest mobile-phone operator VimpelCom Ltd. with Egyptian billionaire Naguib Sawiris’ phone assets.
According to reports, the three board members of Telenor, the second-largest shareholder of VimpelCom, are expected to vote against the deal. Telenor opposes the plan partly because its stake would be reduced by the deal.
As per sources, VimpelCom’s board will vote on the revised deal on Jan. 16. The main shareholders, Telenor and Alfa Group’s Altimo, will meet in Amsterdam to discuss final terms. The deal could be forced through even if Telenor’s three directors oppose it.
In December, the remaining six board members voted for the initial merger agreement.
VimpelCom to discuss lower price for Sawiris deal (Russia)
If sources are to be believed, VimpelCom Ltd.’s board will vote on a revised deal with a potentially lower price for Egyptian billionaire Naguib Sawiris’ phone assets on Jan. 16.
According to sources, the main shareholders, Telenor ASA and Alfa Group’s Altimo, will meet in Amsterdam to discuss final terms. The revised deal could still fall apart.
VimpelCom, Russia’s second-biggest mobile-phone operator had sought to find a new agreement after its biggest shareholder, Telenor, in December rejected a $6.8 billion proposal, saying the transaction wouldn’t help the business or shareholders. VimpelCom Chief Executive Officer Alexander Izosimov was asked to revise the deal.
Opposition from Telenor, the Nordic region’s biggest phone company, is threatening the creation of the world’s fifth- largest mobile-phone company. Under the original deal, VimpelCom sought to obtain all of Italian mobile operator Wind Telecomunicazioni SpA and Sawiris’ 51.7% stake in Egypt’s Orascom Telecom Holding SAE.
The shareholders of Sawiris’ holding company, called Wind Telecom SpA, would have got 20% of new VimpelCom shares valued at $5 billion at current prices and $1.8 billion in cash under the original terms.
Sawiris’s Weather renamed as Wind Telecom (Egypt)
Egyptian mobile operator Orascom Telecom unveiled that its parent company Weather Investments, which plans a $6.6 billion deal to sell assets to Russian operator VimpelCom, has changed its name.
According to Orascom Telecom, Weather, the investment vehicle of Egyptian billionaire Naguib Sawiris, switched its name to Wind Telecom on Dec. 30.
The holding company agreed to sell controlling stakes in Orascom and Italian operator Wind Telecomunicazioni in October, but opposition from VimpelCom shareholder Telenor has cast doubt on the deal. It is now reviewing a revised offer for the assets.
VimpelCom misses deadline for Sawiris deal
Russian mobile operator VimpelCom Ltd. has missed the deadline for signing the final agreements on merging with Egyptian billionaire Naguib Sawiris’s Weather Investments SpA in a multi-billion cash-and-stock deal.
One of the main hurdles to finalizing the deal is the Algerian unit of Weather’s Orascom Telecom, the holding’s major revenue contributor, which the local government is seeking to nationalize.
According to VimpelCom spokeswoman Elena Prokhorova, VimpelCom and Weather continue to work toward closing the transaction as outlined in their Oct. 4 release.
According to previous statements by VimpelCom Chief Executive Alexander Izosimov, when the deal was announced, the company needed to finalize a series of ancillary agreements and the financing plan, with a view to sign the final agreements by the end of November.
VimpelCom agreed to combine with the debt laden telecom assets of Sawiris in a $6.9 billion stock-and-cash deal to become the world’s fifth-largest mobile operator by the number of subscribers.
As per the agreement, VimpelCom will own–via Weather Investments–51.7% of Orascom Telecom and 100% of Italian mobile group Wind Telecomunicazioni SpA.
VimpelCom, Weather plan for deal even without Djezzy
If sources are to be believed, VimpelCom Ltd.’s shareholders and Egyptian billionaire Naguib Sawiris have an agreement to cement a merger even if Algeria nationalizes the local unit of Sawiris’s Orascom Telecom Holding without paying Orascom a cent.
According to the sources, the Russian, Norwegian, Egyptian and the other major shareholders went into the telecom deal with their eyes wide open about the risks of nationalization in Algeria, and they agreed to a plan B, committing them to work toward a merger even without Algerian unit Djezzy.
As per reports citing Orascom Telecom Chief Executive Khaled Bishara, they are still working on the deal and Algeria probably won’t be the deciding factor for selling Sawiris’ approximately 50% stake in Orascom to VimpelCom.
According to VimpelCom spokeswoman Elena Prokhorova, VimpelCom is continuing to work on the deal, including getting the required regulatory permissions, and also on the situation in Algeria. Still, Sawiris recently indicated the deal has a 50% chance at best of being finalized. VimpelCom major shareholder Telenor ASA has also expressed concerns about the problems in Algeria.
