Top court unfreezes Malofeev stake in Rostelecom

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February 6, 2013 11:21 PM EST

The Supreme Court has lifted an order freezing shares in Russian telecoms operator Rostelecom held by Konstantin Malofeev, part of a $330 million (211 million pounds) lawsuit filed by Russian bank VTB , the court and Malofeev's fund said.

The stake had been seized over a case brought by state-owned VTB against Malofeev and his fund Marshall Capital (MarCap) seeking to recover a loan it provided to finance a 2007 deal in which, the bank claimed, MarCap was involved as both buyer and seller.

The court rejected an appeal by VTB's investment banking unit, VTB Capital, against earlier orders, and discharged the freezing order on Malofeev's assets, it said on Wednesday.

"The worldwide freezing order against Mr Malofeev is discharged, because VTB has not been granted permission to serve proceedings on him," the court said on its website.

The ruling came two days after Malofeev's Moscow office was raided by police. In November, the police also raided his house as well as the home of Rostelecom chief executive Alexander Provotorov - MarCap's former head.

VTB was not immediately available for comment.

A source close to VTB said the bank would continue defending its interests in other jurisdictions.

"The Supreme Court ruling does not prove Konstantin Malofeev's case, it only defines the lack of Britain's jurisdiction. No line has been drawn under this matter," said the source, who spoke on condition of anonymity.

The VTB loan had been used to finance the acquisition of dairy plants by Russian company Russagroprom from British Virgin Islands-incorporated Nutritek in which MarCap and Malofeev were shareholders. Russagroprom defaulted on the loan and VTB brought proceedings against Nutritek, MarCap and Malofeev.

(Reporting by Maria Kiselyova, Anastasia Teterevleva and Katya Golubkova; Editing by Douglas Busvine and Mark Potter)

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