Inter RAO sees no risks for Bashkir Generating Co after BashTEK privatization declared illegal
MOSCOW. Nov 20 (Interfax) - Russian energy company Inter RAO does not see any risks for Bashkir Generating Company as a result of BashTEK's privatization being declared illegal, Inter RAO management board member Ilnar Mirsiyapov told journalists.
"Our lawyers are saying that there can't be any questions for us. We are confident of our legal position. All our deals are clean," according to Mirsiyapov, who is also the head of the company's strategy and investment block.
"No one has raised any issues with us on this matter," Inter RAO PR Director Anton Nazarov said.
It was reported that the Basmanny Court ordered the seizure of Sistema's shares in Bashneft as part of the criminal inquiry. On October 27 the Arbitration Court ruled in favor of the Russian Prosecutor General's Office's lawsuit against Sistema and compelled the corporation to return these assets to the state.
Moscow's Arbitration Court October 30 heard a suit by the Prosecutor General's Office and the Federal Property Management Agency (Rosimushchestvo) demanding that Bashneft shares owned by AFK Sistema and its subsidiary, Sistema Invest, be returned to the state. This concerns 71.62% stake in Bashneft. The court decided that the companies' shares were illegally placed in regional ownership in the 1990s and therefore all deals with the shares are void.
Sistema acquired controlling stake in companies of BashTEK in 2005 and 2007 for $2.6 billion in total. At that time, BashTEK's enterprises owned 47.89% of Bashkirenergo , while RAO Energy System of Russia owned 21.27% of the regional energy company's shares, which were then transferred to Inter RAO.
In 2012, Sistema and Inter RAO divided Bashkirenergo with the state company receiving generating assets and Sistema network assets. BashTEK's other assets were merged with Bashneft.
Though the Arbitration Court declared the entire chain of deals with BashTEK assets void, the decision to seize shares extends only to the majority shares package in Bashneft. Minority stake will remain with Sistema subsidiaries Sistema Finance (0.07% of ordinary shares) and Sistema Invest, which returned to itself 2.66% of ordinary Bashneft shares on October 30 that were sold on in a summer REPO deal and prior to the Prosecutor's lawsuit.
The court required the registrar, OJSC Reestr, to debit remove these shares from the accounts of Sistema and Sistema-Invest and to credit them to the account of the Federal Property Agency. This decision will go into force on December 8, 30 days after analysis, if an appeal is not submitted by then. Sistema has said it did not plan to appeal.
Sistema's 92.48% of voting shares in Bashkir Power Grid Company have been frozen since September as part of another case. Moscow City Court declared the injunction on shares of Bashneft following an embezzlement case against former Bashneft CEO Ural Rakhimov, Armenia businessman and philanthropist Levon Hayrapetyan, and Sistema's main owner Vladimir Yevtushenkov. Yevtushenkov has been under house arrest since September 16, and will be until March 16, 2015.
