Sistema strikes back: AFK asks court to arrest Rosneft assets

The representative of Rosneft, in turn, believes that the fall in AFK shares is due to the manipulation of the Sistema itself, and not to the progress of the lawsuit filed by the oil company.
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Sistema-invest (Sistema's subsidiary) solicits application for Rosneft with interim measures of 170.6 billion rubles, a company representative said in court, Interfax reports.

AFK Sistema on June 26 reported that the court seized Sistema's 31.76% stake in MTS, 100% of Medsi's shares and 90.47% of BESK's shares as collateral for claims against Rosneft at 170.6% Billion rubles. Sistema said that the shareholders of the company and the operator of MTS, in which AFK owns 50.03%, have already lost more than 150 billion rubles due to the lawsuit filed by Rosneft. As noted in the ruling of the court, the arrested assets are estimated at 185 billion rubles. The state of the main shareholder of Sistema, Vladimir Yevtushenkov, since March 2017, against a backdrop of a court dispute, has dropped by more than $ 1.5 billion.

"It is necessary to adopt a definition obliging to provide opponents with collateral, since we are already suffering losses. There is every reason to assume that the plaintiffs are not able to compensate for the losses, "he said. AFK Sistema supported this measure. As the correspondent of "Interfax" reports from the courtroom, in the opinion of the representative of the AFC, Rosneft's arguments about the need to take provisional measures "are of an alleged nature".

At the same time, the representative of the AFC stresses that the defendants' property is more than enough for the execution of the court's decision in the present case. "According to the accounting balance sheet of Sistema for the I quarter of 2017, the book value of its assets is 450.9 billion rubles, while the total assets of AFK as of December 31, 2016 amounted to 1.1 trillion rubles. Thus, the real value of Sistema's assets is more than 6.5 times higher than the amount claimed, which is more than enough to enforce a court decision, "a corporate representative said in court.

The battle for assets

He also stressed that the amount of interim measures taken in the present case is clearly disproportionate to the claimed claims. "So, with the claimed amount of claims in the amount of 170.6 billion rubles (taking into account the increase in claims initially claimed for the amount of the exchange difference), the court seized the assets of the defendants, estimated according to the applicants' version, to 185 billion rubles. The colossal and unjustified difference of 15 billion rubles is equivalent to one-fourth of AFK Sistema's net profit for the first quarter of 2017, "the AFC representative said.

In addition, according to Sistema, the definition of taking interim measures includes inaccurate information about the value of the arrested shares. "The cost of a single stake in PJSC" MTS "in the amount of 31.76% owned by AFK Sistema is 197.3 billion rubles. Thus, the shares of PJSC "MTS" alone are sufficient to ensure the interests of the plaintiffs within the framework of the claim, "AFK notes. According to the calculations of Sistema, the aggregate value of the shares for which the arrest was imposed is, even without taking into account BESK's shares, about 250 billion rubles, "which is more than 1.5 times the amount claimed." He also said that the trial negatively affects the cost of shares of AFC and MTS.

Accusations of manipulation

The Rosneft oil company in court insists on maintaining interim measures against Sistema in order to avoid further losses. Commenting on the speech of the Sistema's representative that the court process negatively affects the price of the corporation's shares, the representative of Rosneft noted: "AFK shares fell due to unfair actions of the company, and not as a result of actions of the plaintiffs." A representative of Bashneft also stressed that "the fall in AFK shares is the result of manipulation by AFC itself".

The court refused "Sistema"

The Arbitration Court of Bashkiria rejected the application of Sistema-Invest (a subsidiary of AFK Sistema) to demand a collateral from Rosneft. The petition was motivated by the fact that interim measures cause the defendants losses, in particular, the capitalization of the companies controlled by them is falling. The court also sided with Rosneft in the matter of retaining the shares belonging to Sistema in force.

The court is essentially considering the lawsuit filed by Rosneft and Bashneft against AFK Sistema, the next meeting is scheduled for July 12. Initially, the plaintiffs demanded to recover from Sistema and ZAO Sistema-Invest 106.6 billion rubles of losses caused by Bashneft as a result of its reorganization in 2014. Subsequently, the amount of claims increased to 170.6 billion rubles, taking into account the devaluation of the national currency. AFK Sistema believes that the lawsuit itself and its amount are unfounded. The representative of Sistema earlier noted that all documents relating to the reorganization of Bashneft, including the separation balance sheet, were prepared in full compliance with corporate procedures and the requirements of the current legislation. Consideration of the claim in essence will continue on July 12.