Turkish tycoon Mehmet Emin Karamehmet won some relief in his battle to retain control of Turkcell, the country's biggest mobile phone operator, as a top British appeals court ruled in his favour over a $1.45 billion deposit.
Britain's Privy Council, the highest court of appeal for many Commonwealth countries, quashed an order for Karamehmet's Cukurova Holding to deposit $1.45 billion pending the outcome of its dispute with Russian partner Altimo, a senior Altimo official told Reuters.
Altimo, the telecoms arm of Russia's Alfa group, had hoped to be awarded Cukurova's 13.8 per cent stake in Turkcell if the funds were not deposited by the March 5 deadline.
"As a result of this new ruling, Cukurova's transfer of shares to Altimo will not take place at this stage," Mustafa Kiral, Altimo's vice-president responsible for European mergers and acquisitions, said on Friday.
The original order for the deposit was made by a court in the British Virgin Islands.
Cukurova had put the shares up as collateral for a loan taken from Altimo in 2005, and the dispute centres on whether that loan fell into default.
Altimo says Cukurova failed to pay in time, whereas Cukurova maintains that Altimo had blocked its repayment.
Kiral said he expected a decision on the case by the end of this year. Cukurova officials declined to comment.
Having founded Turkcell in 1994, Karamehmet is locked in a bitter boardroom struggle with both Altimo and Nordic telcommunications firm TeliaSonera.
Teliasonera has a 37 per cent stake in Turkcell, while Altimo has a 13.2 per cent stake it bought off Karamehmet in 2005.
However, Cukurova's 13.8 per cent stake carries controlling rights through its complex management structure.
MV Holding has a 1.2 per cent stake, while the remaining 34.7 per cent is publicly held.
Turkcell's net profit plunged 33 per cent in 2011 to 1.18 billion lira, due mainly to an economic crisis in Belarus that hit its unit there.
The court decision had little impact on Turkcell's share price, which at 9.52 lira by 1410 GMT was just 0.2 per cent lower than Thursday's close.
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