Leading independent proxy firm recommends that shareholders vote against Wind Telecom transaction
Telenor Group today announced that Institutional Shareholder Services (“ISS”), the leading independent proxy voting advisory service to the global financial community, has recommended that shareholders of VimpelCom Ltd. (NYSE:VIP) vote against the proposed increase in share capital and issuance of shares in connection with the proposed acquisition of Wind Telecom S.p.A. at the upcoming Special General Meeting scheduled to be held on March 17, 2011.
In reaching its conclusion, ISS performed a detailed analysis of the market reaction to the Wind Telecom transaction, the proposed transaction terms, equity analysts’ views and the implications for corporate governance at VimpelCom.
In considering the market reaction, ISS noted that since the initial announcement of the transaction, VimpelCom shares have declined by 10.2% and “have not participated in the growth experienced by the broader MSCI Russia and RTS indices, which have increased by 29.3% and 31.3%, respectively. Since VimpelCom Ltd ADRs began trading in April 2010, those shares are down 27.8%, while the MSCI Russia and RTS Indices are up 15.7% and 18.7%, respectively.”
While noting that the reactions of independent equity analysts have been mixed, ISS stated that “analysts appear to be skeptical of the synergies that have been proposed, as well as the risks surrounding the Algerian assets.”
Finally, ISS also raised concerns that consummation of the Wind Telecom transaction could result in termination of the carefully considered shareholders agreement between Telenor and Altimo. Under such circumstances, “the risk to unaffiliated shareholders of losing the bulwark provided by the shareholder agreement – and in particular their ability to elect the independent directors who provide the swing vote on major board decisions – should inspire caution.”
Richard Olav Aa, Executive Vice President and CFO of Telenor, stated that “ISS’ support validates our belief that VimpelCom shareholders will not be well served by the Wind Telecom transaction and that approval of the Wind Telecom transaction will only destroy even more shareholder value. We strongly urge all shareholders to vote against the transaction well in advance of the March 11, 2011 voting deadline to ensure their votes are represented at the Special General Meeting.”
Holders of VimpelCom’s Depositary Receipts must provide voting instructions to the The Bank of New York Mellon, as Depository, on or before 5:00 P.M. New York City time on March 11, 2011 in order for such voting instructions to be processed in time to be voted at the Special General Meeting.
Via: Telenor
Related posts:
- VimpelCom, Altimo, Telenor and Weather Give Undertakings to the Court in Substitute for an Injunction
- Russia telecom firm Svyazinvest’s CEO resigns-paper
- Stephane Richard named Chairman and Chief Executive Officer of France Telecom-Orange
- Telecom Italia Sold Stake In Cuban Etecsa For $706 Mln – CEO
- Flint Telecom sees additional VoIP revenues of $20 Million in 2011 with pending and planned acquisitions
- Thanks to its solid commercial performance, France Telecom-Orange achieved its 2010 objectives and confirmed its commitment to organic cash flow of 8 billion euros in 2011
- Telenor Group passed 100 million subscribers in Asia
- SK Telecom and RIM Launch the BlackBerry Torch – the First BlackBerry Smartphone Combining a Keyboard and Full Touch Screen Experience
- VIVA, the Kuwaiti Telecom Co. signed a partnership agreement with DIGITS TRADING Co.
- Samsung Galaxy Tab ties up with 5 leading mobile operators in India.
Related posts brought to you by Yet Another Related Posts Plugin.
