BVI court confirms Turkcell stake in long dispute between its shareholders
In November, the court of the British Virgin Islands announced its judgement in the case of Russia’s Alfa Telecom Turkey Limited, – an affiliate of Alfa Telecom, one of Russia’s leading private equity telecommunications, - versus Cukurova Finance International Limited; the decision against Alfa confirmed the ownership of Cukurova Holding over a contested stake in Turkcell.
The ruling of the British Virgin Islands court was just part of a series of legal dispute over Turkcell involving its major shareholders Cukurova, Russian private equity firm Alfa, and Nordic telecommunications giant TeliaSonera.
Under the November 2005 deal, Cukurova sold Alfa a 13.22% stake in Turkcell in return for a financing package of $1.7 billion. In November 2006, Cukurova repaid $357 million of the loan and paid $217 million interest. In May this year, Cukurova said it was suing Alfa Telecom Turkey Ltd because Alfa would not accept the early repayment of the remainder of Cukurova’s debts. This move followed Russian firm’s decision to start a court case against Cukurova claiming it had defaulted on the outstanding debt of $1.35 billion (13.8% stake). Alfa alleged Cukurova of trying to use its Turcell stake as collateral to raise new financial to repay the debt. It is important to add that loan was secured and share charges had been granted under both British Virgin Islands law and English law over Cukurova Finance shares and shares of its British Virgin Islands incorporated subsidiaries.
Altimo, which is the telecommunications investment arm of Alfa, said the court had recognised Altimo’s security rights over the contested shares, however, Cukurova was blocking the company’s appropriation of them. It is said in Altimo’s statement that the Court admitted the appropriation of the shares made by Altimo earlier this year was not technically possible, since Cukurova Group has intentionally blocked the registration of Altimo as the owner of the shares in the share register.
The unlisted Cukurova has a total 21.3% stake in Turkcell. TeliaSonera which is also involved in a legal dispute over its bid to increase its stake, is the holder of 37.1% of Turkcell.
[...] telecoms-to-construction group Cukurova Holding, which controls Turkcell, last week won a case in the court of the British Virgin Islands against Russia’s Alpha Group that sought to seize 14 percent of the shares of Turkcell, which was put by Cukurova as security [...]
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