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Mail.ru Files Lawsuit in Shareholder Struggle Over Social Network VK

VK founder Pavel Durov

The two biggest shareholders in Russia's largest social network, VK, will meet in court, with one seeking to annul the other's purchase of shares.

The dispute pitches Russia's richest man, Alisher Usmanov, against Ilya Sherbovich, a businessman and former banker whose investment vehicle United Capital Partners bought 48 percent of VK last year, leapfrogging Usmanov's Mail.ru to become the social network's largest shareholder.

Mail.ru has since returned the favor, boosting its share to 52 percent in March with the purchase of Bulion Development, which on Monday announced it had filed a lawsuit against two companies controlled by United Capital Partners, Forbes.ru reported.

Bulion, which owns 11.9 percent of VK, claims that the two companies' purchase of shares in the website violated an agreement giving existing shareholders the right to first refusal on any share sale.

At the same time, United Capital Partners has filed a lawsuit against the VK's founder Pavel Durov and fellow shareholder Mail.ru over ownership of instant messaging service Telegram Messenger.

United Capital Partners considers Telegram, which Durov developed while working as chief executive of VK and launched last year, to be to the property of the social network. United Capital Partners has bought three companies that manage various parts of Telegram from Axel Neff, one of Durov's partners, and has filed a claim on in the British Virgin Islands, where both VK and Mail.ru are based, Vedomosti reported.

Twenty-nine-year-old programmer Durov has been at loggerheads with United Capital Partners since it became a major shareholder in the social network that he founded with the name Vkontakte in 2006, which now boasts 143 million registered users.

On April 1, Durov suddenly announced his resignation from VK — which he later withdrew — saying that he was quitting because "the CEO has significantly less freedom in managing the company after the changes occurred in the Vkontakte shareholders' structure in April 2013," and that he found it "increasingly complicated to stick to the principles we once founded our social site upon."

Analysts have speculated that Sherbovich, who has sat on the boards of state-owned Rosneft and Transneft, is playing the role of Kremlin proxy to undercut Durov and make the company more amenable to the desires of the state. During a wave of street protests that began after parliamentary elections in December 2011, Durov refused a request by the Federal Security Service to block a number of pages on the site.

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