Deripaska Foiled Again as Share Emission Blocked

Aluminum and industrial tycoon Oleg Deripaska's plans to create a super insurance holding have been stymied once again by adversary Andrei Andreyev.

The Moscow Arbitration Court has halted a 400 million ruble ($12.7 million) share emission by leading insurance company Ingosstrakh -- controlled by Deripaska's Base Element -- and its registration by the Federal Securities Commission.

In addition, shares in Avtobank, insurance company Rossiya and metals company Nosta have been frozen as one-time owner Andreyev tries to regain control of the assets he says were stolen from him last year.

"The decision made by shareholders in May [to issue stock] is not legitimate because at the time, those shares had been frozen," said Tatyana Dyogtyar, Andreyev's business partner.

In April, Alexander Samodelkin, an Interior Ministry investigator, froze 84 percent of Ingosstrakh, 84 percent of Rossiya, 65 percent of Avtobank and controlling stakes in Ingosstrakh-Soyuz and Nosta after Andreyev filed a complaint that his business had been stolen from him. But on June 28, the shares were unfrozen. The stakes were held by Base Element, Millhouse Capital and Nafta-Moskva.

The June ruling was then overturned Sept. 10 by the Presnensky court and the stakes were frozen again, but not before Base Element and its partners got busy trading the shares Andreyev says are his.

NIKoil bought a 90 percent stake in Avtobank with Anti-Monopoly Ministry approval, Aton announced its acquisition of Rossiya and Ingosstrakh started its share emission that was to dilute the controversial stake to 17 percent.

Deripaska then announced plans to create his insurance holding. Base Element had an agreement to sell Ingosstrakh shares to the MAKS insurance company and Alexander Mamut. However, according to Baker & McKenzie lawyer Sergei Voytishkin, if Andreyev is able to disprove the legitimacy of the Ingosstrakh shareholders meeting, then the Federal Securities Commission may rule the share emission illegal. "This happens frequently in practice," he said.

Aton managing director Albert Gavrikov said the frozen assets were "the seller's problem. We bought them in good faith."

Nevertheless, Andreyev still has some way to go before he can celebrate. The Presnensky court verdict can still be appealed by the prosecutor's office, whose representative said at the Sept. 10 hearing that the unfreezing of assets in June was legal.