A London court on Tuesday thwarted an attempt by Telenor to prevent the dilution of its stake in VimpelCom Ltd., easing the way for the Russian group to buy Naguib Sawiris' telecom assets.
Norway's biggest telecom company sought an injunction to prevent the dilution of its 36 percent stake in VimpelCom, Russia's second-largest cellphone group, to the benefit of old rival and co-owner Mikhail Fridman's Alfa Group.
VimpelCom has the backing of Alfa and its board to take control of emerging markets-focused Orascom Telecom and Italy's Wind from Sawiris, the Egyptian-born tycoon.
Telenor has said the deal does not make financial or strategic sense. It would need the support of more than 70 percent of minority shareholders if it is to block the deal on March 17, a target that one banker described as "an uphill struggle."
Telenor declined comment in an initial reaction on Tuesday but said it would issue a statement later in the day.
"We are pleased that the court agreed with VimpelCom on the importance of allowing the shareholders to cast their vote on March 17," VimpelCom chief executive Alexander Izosimov said in a statement.
The court said the meeting can go ahead as planned and also refused to accept Telenor's alternative request to have pre-emptive shares issued to it in escrow pending the outcome of the arbitration initiated by Telenor.
VimpelCom's general counsel told reporters Tuesday that "VimpelCom agreed to undertakings to protect Telenor's pre-emptive rights if the arbitration panel decided in Telenor's favor," but did not elaborate.