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. Last Updated: 07/27/2016

Sberbank Minority Cries Foul

Minority shareholders trying to oust the head of Russia's biggest bank, Sberbank, over a planned share issue said Monday they would fight the bank's refusal to hold an extraordinary general meeting.

"We will take all legal measures that are necessary to enforce our rights," said Hermitage Capital Management director Bill Browder.

"We will go to court if that is required or take whatever other legal steps are necessary."

The bank's supervisory board on Friday rejected the demand for an EGM, saying shareholders filed it incorrectly and failed to prove they held the 10 percent needed to call the meeting.

Browder said the group held more than 10 percent of Sberbank and had filed the EGM request after ample legal advice.

"The refusal to call this meeting is a clear example of how shareholder-unfriendly Sberbank is and shows the need for reform and change," he said.

The Central Bank has a controlling stake in Sberbank.

Troika Dialog analyst Andrei Ivanov said the refusal might hurt Sberbank's share price, which edged up after Hermitage announced two weeks ago that the group would call an EGM to attempt to oust Sberbank chief Andrei Kazmin.

The shareholders' group said the planned share issue — approved by shareholders several years ago — would amount to selling off new shares at a fraction of book value because of adverse market conditions.

"We are putting Sberbank under the spotlight of scrutiny in the same way as we did with Unified Energy Systems, hoping that the government will … protect the interests of the state, depositors and minority shareholders," Browder said earlier this month.