What is not addressed is Bermuda's monetary authority's suit to have IPOC dissolved - not much fun for Usmanov to buy IPOC and then find that they don't own exist. In short, Alfa got their stock and Reiman lost his reputation.
FT.com / Companies / Telecoms - Russian phone feud peace deal:
Russian phone feud peace deal
By Neil Buckley in Moscow
Published: July 30 2007 03:43 | Last updated: July 30 2007 03:43
One of Russia’s longest-running and most bitter corporate feuds has been settled in what could clear the way for an ownership shake-up in the booming Russian mobile telecoms sector.
The telecoms arm of the Alfa Group conglomerate, controlled by the oligarch Mikhail Fridman, and Ipoc, a Bermuda-based investment fund, have signed a “peace agreement” ending their battle over a 25.1 per cent stake in MegaFon, Russia’s number three mobile telecoms operator.
The groups agreed late last week after several months of talks to end all court actions and renounce legal claims against each other.
Alfa’s telecoms arm, now known as Altimo, bought the MegaFon stake in 2003 from entrepreneur Leonid Rozhetskin.
But Ipoc challenged the deal, saying it had earlier options agreements with Mr Rozhetskin to buy the stake. The conflict generated legal and arbitration proceedings in Switzerland, Bermuda, Russia, Sweden and New York, several of which in the past year had found in Altimo’s favour.
The two companies refused to comment, but people familiar with the negotiations said the peace deal left Altimo in control of the 25.1 per cent MegaFon stake. Ipoc directly and via an intermediary company, Telecominvest, controls another 39.3 per cent of MegaFon.
The deal clears the way for Ipoc to negotiate the possible sale of its MegaFon stake to Alisher Usmanov, another billionaire Russian businessman.
With analysts estimating MegaFon’s market value at about $15bn, 39.3 per cent would be worth about $5.9bn.
People familiar with the situation said Mr Usmanov had contacted Ipoc about a sale but made it a condition that the dispute with Altimo be resolved.
The peace deal could also clear the way for a long-awaited initial public offering of MegaFon.
The Alfa-Ipoc battle generated particular controversy, as Alfa repeatedly alleged in legal action that Leonid Reiman, Russia’s telecommunications minister, was Ipoc’s owner, and not its ostensible owner, Jeffrey Galmond, a Danish lawyer. Mr Reiman and Mr Galmond have denied the claims.
But a Zurich arbitration panel said in May 2006 it believed Ipoc’s beneficial owner was an unnamed individual who “served as a high-ranking officer in the Russian Federation with the function of co-ordination and regulation” of communications in Russia.