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Rosneft and Bashneft file $2.2 billion lawsuit against AFK Sistema

17:05 07/12/2017

MOSCOW, December 7 (RAPSI) – Russian oil corporations Rosneft and Bashneft have filed a lawsuit with the Bashkortostan Republic’s Commercial Court seeking to recover 131.6 billion rubles (about $2.2 billion) of damages from AFK Sistema and Sistema-Invest.

According to the Rosneft statement, Sistema used various financial schemes, including payment of unprecedented dividends, to transfer funds out of Bashneft before return of the latter company to the state property. These funds were needed for the latter company’s normal, continuous and safe functionality, Rosneft asserts.

This situation resulted in violations of terms and quality of repair services, deterioration of equipment and accidents on several plants, requiring additional expenses, Rosneft stated, noting that it attempted to reach settlement in this case.

On August 23, the Commercial Court of the Republic of Bashkortostan recovered 136.3 billion rubles (about $2.3 billion) from AFK Sistema in favor of Rosneft. Sistema considers the ruling unlawful and unreasonable saying it plans to challenge it in the Eighteenth Commercial Court of Appeals. Rosneft sought to recover 170.6 billion rubles (about $2.8 billion).

On June 23, the Commercial Court of the Republic of Bashkortostan seized 31.76% of MTS mobile operator’s shares owned by AFK Sistema and its subsidiary Sistema-Invest as well as 100% of Medsi Group’s shares and 90.47% of Bashkir Power Grid Company’s (BESK) as part of 170.6 billion rubles (about $3 billion at the current exchange rate) lawsuit filed by Rosneft, Bashneft and Republic of Bashkiria against the companies.

On August 7, AFK Sistema appealed the seizure with the Eighteenth Commercial Court of Appeals.

Press service of Rosneft has said previously that the lawsuit is connected with alleged siphoning of assets. Actions of AFK Sistema allegedly led to decrease of assets at this sum.

Initially, Rosneft sought to collect 106.6 billion ($1.8 billion) in damages from Sistema. Later the oil giant increased its claim to 170.6 billion. The plaintiff revised the claim damage upwards taking into account currency fluctuations, according to a company’s representative.

According to AFK Sistema, the plaintiffs’ demands are illegal and groundless.

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Rosneft and Bashneft file $2.2 billion lawsuit against AFK Sistema

17:05 07/12/2017 Russian oil corporations Rosneft and Bashneft have filed a lawsuit with the Bashkortostan Republic’s Commercial Court seeking to recover 131.6 billion rubles (about $2.2 billion) of damages from AFK Sistema and Sistema-Invest.
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