VimpelCom Ltd has cleared a significant hurdle in its quest to acquire Wind Telecom after a London court rejected a bid by VimpelCom shareholder Telenor to derail the US$6 billion deal. Reuters reports that the court refused to accept Telenor’s request to have pre-emptive shares issued to it in escrow, pending the outcome of a separate arbitration that was to rule on whether it was allowed to do so. Telenor has previously argued that the merger is “not in the best interests of VimpelCom shareholders,” and stands to see its shareholding in VimpelCom significantly diluted if the deal goes ahead. “It looks like the Wind transaction will be completed,” Tore Toenseth, a telecoms analyst at Argo Securities, told Reuters. While the ruling is seen as a blow to Telenor, VimpelCom has given assurances to its Norwegian partner that it will get its pre-emptive rights back if it won the arbitration case and vowed that Telenor’s voting stock in VimpelCom would not fall below a 25 percent threshold until arbitration ends. Telenor described this commitment as “the next best thing” to an injunction.

“Telenor remains confident that the arbitration tribunal will recognise Telenor’s right to receive the pre-emptive right shares if VimpelCom’s proposed acquisition of Wind Telecom is completed,” said Telenor spokesman Dag Melgaard, adding that Telenor will now focus its attention on rallying independent shareholders against the deal. But analysts believe that Telenor faces an uphill struggle in finding enough supporters to help it block the deal when it goes to a shareholder vote on 17 March. “We strongly believe that the shareholder meeting will support the deal,” said VTB Capital analyst Viktor Klimovich.