VimpelCom’s board has voted in favour of its merger with Orascom parent Weather Investment, but will review the terms of the deal following opposition from Telenor – a major VimpelCom shareholder. VimpelCom’s nine-strong board voted six-to-three in favour of the deal, with the three Telenor board members voting against. Those voting in favour were the three members of Alfa Group’s Altimo – the firm’s other main shareholder – and the three independent members that represent minority shareholders. While the deal has been approved in principal, VimpelCom noted in a statement that due to Telenor’s opposition, “no agreement has been reached with respect to the shareholder related agreements that were contemplated to be entered into in connection with the transaction.” As a result, the board has instructed VimpelCom CEO Alexander Izosimov (pictured) to “negotiate further with Weather the terms and conditions under which Weather would be willing to enter into a revised transaction.”

This could mean that the terms of the deal originally proposed when the US$6.5 billion merger was first announced in October 2010 could be radically altered – presumably in an effort to make the deal more attractive to Telenor. Under the original terms, Weather would receive a cash consideration of US$1.8 billion plus 19 percent of voting rights in the enlarged group, with Telenor and Alfa Group’s shareholdings diluted as a result. VimpelCom would also take on a substantial amount of Weather’s current debt. This is thought to be a major concern at Telenor, which is reportedly worried that this could mean cash generated by Weather/Orascom would have to be used to reduce its debt rather than provide dividends for VimpelCom’s shareholders. A Telenor spokesperson told Dow Jones Newswires that the firm would wait to see the revised terms before rethinking its current position.