Sistema shares fall over 23% after news of Rosneft lawsuit

Shares in oligarch Vladimir Yevtushenkov’s conglomerate Sistema fell by more than 23 per cent on the Moscow Exchange on Wednesday on news that Rosneft, Russia’s state-run oil monopoly, filed a Rbs106.6bn ($1.87bn) lawsuit against the company.

Rosneft and Bashneft, a former Sistema subsidiary it acquired from the government last year, filed the lawsuit on Tuesday, according to the Moscow arbitration court’s website. The reason for the lawsuit is not listed.

Rosneft spokesman Mikhail Leontiev told Interfax that the lawsuit accuses Sistema of “asset stripping” during its ownership of Bashneft. Sistema said in a statement to the London stock exchange, where it is also listed, that it had not been served with the lawsuit. The company declined further comment.

Rosneft acquired a controlling stake in Bashneft from the state in a controversial Rbs330bn deal last year that helped cement Rosneft chief executive Igor Sechin’s hold on Russia’s energy sector. Mr Yevtushenkov lost control of the company, which he privatized in the early 2000s, in 2014 as part of criminal charges ruling the privatization had been illegal.

Mr Yevtushenkov spent six months under house arrest, then was abruptly released after the charges were dropped. Many in Russia’s business community believed the powerful Mr Sechin was behind the case as part of his multi-year attempt to acquire Bashneft; Mr Sechin denies this.

(This article has been amended to correct Mr Yevtushenkov’s first name.)