Luxembourg-based ABH Holdings S.A. (“ABHH”), co-owned by Russian oligarch Mikhail Fridman, will seek to protect its investments via legal action if JSC Sense Bank (owned by ABHH) is nationalized, according to an official press release dated June 16.
ABHH will seek protection under the BLEU (Belgium-Luxembourg)-Ukraine Bilateral Investment Treaty. This treaty permits an appeal to an international court if a signatory state refuses to compensate a company for the loss of its investments.
Sense Bank — formerly Alfa Bank, a component of Fridman’s Alfa Group — is one of Ukraine’s largest banks, and has been the site of numerous protests by Ukrainians for its Russian ownership. It rebranded from Alfa Bank to Sense Bank in July 2022.
ABHH said it was particularly concerned about bill No. 9107-1, which provides grounds for the nationalization of banks owned by sanctioned individuals, including the Russian-owned Sense Bank. The bill passed the first reading in Ukraine’s Verkhovna Rada on April 11.
“In case of the nationalization of JSC Sense Bank, the loss to ABHH and its shareholders will be significant,” an ABHH spokesperson said.
“Accordingly, ABHH will take appropriate measures, both in terms of domestic and international law and available treaties, to protect its investment and mitigate its losses. The new law is discriminatory and violates international law standards of fairness to investors. The nationalization of JSC Sense Bank would result in losses for bondholders as well as the shareholders of ABHH, including a U.S. charity focused on cancer research and a major European bank.”
The relevant shareholders are the Mark Foundation for Cancer Research and Italian UniCredit S.p.A., owning 3.8736% and 9.9% of shares respectively.
Fridman, ABHH’s main owner, is currently subject to U.S. sanctions and owns 32.8632% of the shares, while Petro Aven owns 12.4018%, and Andriy Kosohov — 40.9614%.
Former Deputy Prime Minister for Economic and Demographic Policy of Bulgaria, Simeon Dyankov, was appointed by the National Bank of Ukraine to manage the shares of the latter two individuals.
Earlier this week, ABHH announced that it had reached an agreement to sell a 75.6% stake in Sense Bank to an international investor for $1.