Telenor Files Insider Trading Lawsuit Against Russia's Alfa

MOSCOW -(Dow Jones)- Norwegian telecoms operator Telenor Thursday said it had filed a suit accusing Russian conglomerate Alfa Group of insider trading in shares of Russian mobile firm VimpelCom.

Telenor, which owns 29.9% of VimpelCom, Russia's second-largest cellular operator by subscribers, alleges that Alfa officials received advance notice of VimpelCom's financial results and the proposed dividend before buying American Depositary Receipts in the Russian firm.

Alfa's telecoms arm Altimo has raised its stake in VimpelCom to 42.4% from 32.9% since August 2006 amid an ongoing dispute with Telenor over VimpelCom's expansion strategy. Telenor has raised its stake from 26.4% during the same period.

"Telenor has taken this action to protect the rights and interests of VimpelCom and its shareholders," said Jan Edvard Thygesen, Executive Vice President and head of Telenor's Central and Eastern Europe operations.

Telenor also alleges that Alfa made false, misleading and incomplete filings with the U.S. Securities and Exchange Commission. Specifically, Telenor says Altimo told media, but never the SEC, that it intended to gain control over VimpelCom.

The complaints name Altimo Chief Executive Alexei Reznikovich, that company's vice-president Oleg Malis and Alfa's largest shareholder Mikhail Fridman.

"This shouldn't affect VimpelCom's share price, but it will be bad for Alfa's image," said Troika Dialog analyst Evgeny Golossnoy, adding that it may be hard for Telenor to prove its allegations.

An Altimo spokesman declined to comment immediately on the case, but said a statement would follow later Thursday.

VimpelCom ADRs closed 0.9%, or 88 cents, lower at $100.96 Wednesday.

Company Web sites: www.vimpelcom.com;

http://www.altimo.org;

http://www.telenor.com

-By Will Bland, Dow Jones Newswires; +7 495 974 80 55; william.bland@dowjones.com

(END) Dow Jones Newswires"

Posted to the site on 7th June 2007