Russian operator MTS says it has reached a settlement worth $150 million with Altimo and Nomihold Securities over its disputed acquisition of Bitel, an operator in the Kyrgyz Republic, in 2005.
MTS (Moscow, Russia) is to receive a payment of $150 million under the settlement, which includes a figure of $125 million it has already received during the proceedings.
The dispute dates back to 2005, when MTS paid $150 million to Nomihold Securities for a 50% stake in Bitel (Bishkek, Kyrgyz Republic), the largest mobile operator in the Kyrgyz Republic.
MTS claims that Bitel’s offices in Bishkek were seized by Kyrgyz authorities three days after its takeover announcement and that it was unable to gain operational control of the company.
Shares in Bitel were subsequently sold and re-registered in the names of purportedly independent companies, according to MTS.
In 2007, MTS said it had become apparent that shares had been sold to Sky Mobile, another Kyrgyz operator part-owned by Russian investment group Altimo (Moscow, Russia).
The $150 million settlement relates specifically to a put option that MTS had to acquire the remaining 49% of Bitel for $170 million.
MTS wrote off investments in Bitel in 2007, at which time it legally challenged the obligations it had according to that option.
The operator is to book a gain of $320 million in the second quarter of the year, having previously written off Bitel-related investments by the same amount.