A mysterious and minor shareholder in VimpelCom on Friday withdrew its lawsuit against Telenor, removing the final obstacle for the Norwegian telecoms firm and Alfa Group to merge their stakes in Russia's second-largest mobile operator and Ukraine's Kyivstar.

A federal arbitration court in Tyumen dismissed a decision from a lower court in Omsk, which had ruled in favor of Farimex Products on fining Telenor $1.7 billion.

Farimex's case was widely seen as a tool to put pressure on Telenor to either unite its assets with those of Altimo, Alfa Group's telecoms arm, or to divorce them fully. Altimo repeatedly denied any connection to Farimex.

The Omsk court's ruling had become a stumbling block in Russian-Norwegian ties and weakened investor confidence in the country's judiciary.

Farimex, which owns 0.002 percent of VimpelCom, filed its lawsuit in 2008. The suit claimed that Telenor-appointed board members hindered VimpelCom's expansion into the Ukrainian market in 2005 by blocking the purchase of Ukrainian Radio Systems, an asset VimpelCom later acquired anyway.

On orders from the court, marshals seized Telenor’s stake in VimpelCom and were preparing to sell it to compensate VimpelCom to the tune of $1.7 billion for having missed a chance to move into the Ukrainian market.

Dmitry Chyorny, a lawyer for Farimex, confirmed that the company "had no claims" against Telenor.

"The situation has been settled. Everyone is satisfied," he said by telephone from Tyumen, without elaborating.

Dismissal or withdrawal of Farimex's lawsuit at no loss to Telenor was one of the conditions for the deal to merge VimpelCom and Kyivstar to be closed.

Telenor, which owns 30 percent in VimpelCom, and Altimo, which holds 44 percent of the voting stock, reached an agreement in October to end their long-running feud. Under the agreement, Altimo and Telenor are creating a new venture — Bermuda-registered Vimpelcom Ltd. — that will incorporate their stakes in VimpelCom and Kyivstar.

Altimo will hold a 43.89 percent voting stake in the new company, while Telenor will own 35.42 percent.

Telenor said it was satisfied that Farimex had withdrawn the lawsuit.

"Farimex's withdrawal of its claim today and the cancellation of the Omsk ruling are steps in the right direction," said Jan Edvard Thygesen, Telenor executive vice president and head of operations in Central and Eastern Europe.

"This case never had any merit, and we are pleased it has been withdrawn. However, the decision of the Tyumen court can be appealed. Before closing can occur, there are still enforcement proceedings to be withdrawn" by court marshals, he said in a statement published on Telenor's web site.

Chyorny, the lawyer for Farimex, declined to comment on whether the company had decided to withdraw its lawsuit to fulfill the conditions of the deal between Telenor and Alfa.

Dag Melgaard, a spokesman for Telenor, said he had no idea why Farimex had withdrawn the lawsuit, but he said the company was "fairly satisfied" with the withdrawal.

"This accusation had no root in reality. In the agreement with Altimo, it is clearly stated that one of the conditions to close the deal was that the Farimex case should disappear at no cost to Telenor," Melgaard told The Moscow Times.

The resolution came as VimpelCom on Friday announced the results of its offer for U.S. investors holding the company's shares and American Depositary Receipts.

VimpelCom, which operates under the Beeline brand, said U.S. shareholders had offered a total of 308.3 million ADRs representing 15.4 million shares, or 26.7 percent of the company's stock, for buyback.

A deadline expired Thursday for minority shareholders to exchange their stock in VimpelCom for shares in the new consolidated company, Vimpelcom Ltd.

“We are very pleased with such a positive response to the U.S. offer. The overwhelming market support for the transaction shows investors’ backing for us to continue to successfully develop our business within the new structure,” Boris Nemsic, chief executive of VimpelCom, said in a statement.

The company's Russian offer will be closed Tuesday. VimpelCom said it expected its largest shareholders — Telenor and Altimo — to offer their stock for buyback by that time, bringing the amount of shares exchanged in Russia and the United States to 56 million, or 97.29 percent of outstanding shares.

The threshold for the deal to be closed is 95 percent.

Depositary receipts of Vimpelcom Ltd. will start trading on New York Stock Exchange on Thursday.

The procedure of listing the new company's shares in Russia may take six months to a year, said Viktor Klimovich, a telecoms analyst at VTB Capital.

VimpelCom shares are currently depressed because of a number of technical factors related to the creation of Vimpelcom Ltd. and are trading at a 10 percent discount to the shares of Mobile TeleSystems, its larger rival, he said in an e-mailed statement.

The situation has created a good chance "to enter a fundamentally strong company at quite a cheap valuation," Klimovich said.

VimpelCom's New York traded shares closed down 0.6 percent on Friday at $16.80.