The Siberian litigation blossomed from a simple dispute between Telenor and the Alfa Group, a Russian financial investment company, over plans to expand a jointly owned business, the VimpelCom cellphone company, into Ukraine. The companies are also in court in Manhattan, Geneva and Ukraine.That a dispute over whether to invest in a Ukrainian provider ends up in an Omsk court is interesting enough. What is more interesting is that the suit was brought by an unknown tiny investor in the British Virgin Islands that owns .002 of the shares in VimpelCom. And that a dispute over a bacon producer may have entered into the final court decision.
This is certainly a case where expert use of the courts may lead to western shareholder expropriation, not new in Russia. The interesting question is whether it will lead to a strike of foreign investors regarding Russia. Is it another Lena Goldfields (see previous post)? My guess is that the impact will be minimal, especially regarding potential investments in oil and gas. But we shall see.