Telenor CEO Quits Vimpelcom Board Amid Uzbek-Tie Question

Updated on

Telenor ASA Chief Executive Officer Jon Fredrik Baksaas left the board of VimpelCom Ltd. after Swedish authorities started a probe into whether Russia’s third-biggest wireless carrier paid bribes in Uzbekistan.

Baksaas told VimpelCom, in which Oslo-based Telenor holds 33 percent of the equity and 43 percent of the voting rights, that he’s stepping down immediately, the Norwegian phone company said late yesterday in a statement. Telenor views corruption allegations as “serious” and will take measures to uphold its interests, it said.

“I am stepping down from the VimpelCom board to solely focus on protecting Telenor’s position,” Baksaas said. “Telenor has zero tolerance for corruption. As an owner in VimpelCom, we will assist ongoing investigations.”

Baksaas’s departure from VimpelCom follows questions that arose last month about its ties to Takilant Ltd., a company linked to Uzbek President Islam Karimov. Swedish prosecutors said in a Nov. 10 document that payments totaling $55 million in 2007 and 2011 from VimpelCom to Takilant are suspected to be “bribes” to Uzbek authorities.

Norway’s government, which owns about 54 percent of Telenor, summoned Telenor Chairman Svein Aaser last month to discuss the matter. The constitution and control committee of Norway’s parliament will probably open a hearing on the case before Christmas, the Green Party said last week.

Graft Accusations

Artem Minaev, a spokesman at VimpelCom’s Amsterdam headquarters, declined to comment on Baksaas’s move. Calls to phone numbers listed on the Uzbek government website weren’t answered after office hours, and no e-mail addresses or phone numbers for Takilant could be immediately identified.

TeliaSonera AB’s former CEO Lars Nyberg resigned last year after a law firm hired to investigate graft accusations said the Swedish operator should have been more careful when it bought its Uzbek phone license, also from Takilant.

The carrier has no grounds to sue for damages against Nyberg for fiscal year 2013, leaving open the possibility of legal action against other officials pending further investigations, according to a statement today.

Telenor shares slipped 0.9 percent to 151.5 kroner at 11:15 a.m. in Oslo trading. TeliaSonera declined 0.7 percent to 52.75 kronor, while VimpelCom slumped 7.3 percent to $4.29 yesterday in New York.