The court upheld the claim for the suspension of corporate rights in the Russian subsidiary of X5

Moscow. 25th of April. INTERFAX.RU – The Arbitration Court of the Moscow Region upheld the application of the Ministry of Industry and Trade to X5 Retail Group to suspend corporate rights in LLC Corporate Center ICS 5, the retailer’s press service said.

“The court granted the application in full, but has not yet published the full text of its decision. Thus, the company is not aware of the specific content of the court decision and the date of its publication, which serves as the starting point for the procedures provided for by law,” the statement said.

The Ministry of Industry and Trade’s filing of an application to suspend the corporate rights of the holding company in relation to Corporate Center X 5 LLC became known on March 29. This legal entity is included in the list of economically significant organizations (ESO), which implies the possibility of transferring shares in Russian organizations to the final owners.

According to the company, the decision also means that Russian holders and ultimate owners of GDR X5 will be required to accept shares of the Russian subsidiary in proportion to their participation in the Dutch company. For non-Russian security holders, this possibility is allowed.

In addition, the completion of the trial suggests that the Russian subsidiary will now be able to obtain a listing on the Moscow Exchange. Previously, the head of X5’s investor relations department, Maria Yazeva, reported that after these events are completed, the company may return to studying the issue of dividends, as well as revising its dividend policy.

On April 1, the court accepted the application of the Ministry of Industry and Trade for proceedings and involved in the case as third parties not making independent claims, Corporate Center ICS 5 LLC, Altex LLC (Moscow), the Cypriot company Speak Global Limited and the Interdistrict Inspectorate of the Federal Tax Service No. 46 Moscow time.

The court scheduled a hearing for April 23 “to consider the validity of the application of the Ministry of Industry and Trade of the Russian Federation to suspend the exercise by the foreign holding company X5 Retail Group NV of corporate rights in the economically significant organization limited liability company “Corporate Center ICS 5.” On April 23, the court decided to consider the issue in closed mode.

On April 1, the Moscow Exchange decided to suspend trading in global depositary receipts (GDR) of X5 Retail Group from April 5 in connection with a lawsuit by the Ministry of Industry and Trade.

In connection with the trial, it was decided to remove CEO Igor Shekhterman and company president Ekaterina Lobacheva from the board of X5. They will continue to manage the subsidiary LLC Corporate Center X 5. The same applies to the six members of the X5 supervisory board: Leonid Afendikov, Dmitry Alekseev, Alexey Korni, Yulia Solovyova, Azer Talibov and Vadim Zingman.