Monday, August 08, 2005
Vimpelcom EGM - Note from ISS
Company: Vimpel Communications
When: August 15, 2005
Where: Moscow, Russia
Why: VimpelCom's largest shareholder, Alfa Group, has called a special meeting to seek investor approval of an acquisition of telecommunications firm Ukrainian Radio Systems. VimpelCom's management supports the transaction, which would allow the company to enter the promising Ukrainian market. Alfa sought the shareholder vote after management failed twice to get board approval for the deal. According to VimpelCom's charter, acquisitions must be approved by eight out of nine directors. Three members on the board represent Telenor, the company's second-largest shareholder, and have opposed the transaction. Telenor opposes VimpelCom's entry into the Ukraine, as the acquisition of Ukrainian Radio Systems would create a direct competition to another player in the market, Kyivstar, in which Telenor holds a 55-percent stake. At the special shareholder meeting, the acquisition will be voted on as a related party transaction since Pavel Kulikov, one of VimpelCom's directors, has been recently elected to the Ukrainian Radio Systems board, thus becoming an interested party to the transaction. Accordingly, the acquisition must be supported by at least 50 percent of all votes cast at the meeting and does not require board approval.
When: August 15, 2005
Where: Moscow, Russia
Why: VimpelCom's largest shareholder, Alfa Group, has called a special meeting to seek investor approval of an acquisition of telecommunications firm Ukrainian Radio Systems. VimpelCom's management supports the transaction, which would allow the company to enter the promising Ukrainian market. Alfa sought the shareholder vote after management failed twice to get board approval for the deal. According to VimpelCom's charter, acquisitions must be approved by eight out of nine directors. Three members on the board represent Telenor, the company's second-largest shareholder, and have opposed the transaction. Telenor opposes VimpelCom's entry into the Ukraine, as the acquisition of Ukrainian Radio Systems would create a direct competition to another player in the market, Kyivstar, in which Telenor holds a 55-percent stake. At the special shareholder meeting, the acquisition will be voted on as a related party transaction since Pavel Kulikov, one of VimpelCom's directors, has been recently elected to the Ukrainian Radio Systems board, thus becoming an interested party to the transaction. Accordingly, the acquisition must be supported by at least 50 percent of all votes cast at the meeting and does not require board approval.
