|By PR Newswire||
|April 24, 2014 01:55 PM EDT||
MOSCOW, April 24, 2014 /PRNewswire/ --
United Capital Partners, the owner of companies with a 48% stake in VK.com, Russia's leading social media site, claims VK's former chief executive officer and founder, Pavel Durov, is attempting to present himself as a political dissident in order to divert attention from his serious legal challenges.
UCP issued proceedings (through two of its investment vehicles) in the British Virgin Islands on April 4 to protect its economic rights and those of its fellow shareholders following the launch of the Telegram application, claiming, among other things, that Durov embezzled corporate funds, breached his fiduciary duties to shareholders and diverted corporate opportunities to himself. Since that case was filed, Durov has presented himself as a victim of politics, alleging that he has been pressured by the FSB and Prosecution Office of Russia to provide information about VK users in Ukraine and Russia. He also claims that VK is now "controlled by Igor Sechin and Alisher Usmanov".
Victoria Lazareva, partner at UCP, says Durov is not a victim of politics:
"The first time we learned of these letters from the Government agencies was when Durov mentioned them online. Durov withheld them for months and, whilst we fully agree that these types of requests present a difficult dilemma for VK, we would expect the company CEO to immediately bring them to the attention of the board. Neither of the two ultimate beneficial owners of VK (UCP and Mail.ru/USM) are controlled, financed or directed by the Russian government or Mr. Sechin, who is the CEO of Rosneft. UCP is a private investment partnership controlled by Ilya Sherbovich, well-known Russian investment professional, and Mail.ru is a public company listed on the London Stock Exchange".
"Durov is attempting to divert attention from his serious legal challenges by creating a political smokescreen. This is pure fantasy and a further example of Durov's increasingly erratic behaviour. He left the company because he was dismissed at the direction of Mail.ru, not for any political reason or with the approval or even knowledge of UCP or its representatives. Durov is not a victim of politics. He is a victim of his own actions, for which we fully intend to hold him to account before a court of law, which in this instance, is located in the BVI and therefore not influenced by Russian politics."
UCP first became aware of the launch of the Telegram instant messenger application last August. In its lawsuit, UCP contends Telegram was founded and developed by Pavel Durov, using VK's resources, while he was a Director of VK.Com Ltd and Chief Executive Officer of its Russian operating subsidiary.
- In March 2012, VK conducted a competition for developers and designers to design and create a mobile messenger for VK. VK paid the winners, P. Yakovlev and I. Rimchikov over RUB 3 mn. They joined Telegram shortly afterwards.
- In September 2012, VK conducted a competition for developer to create a mobile photography application called Pictograph. The winner, Ilya Laktiushin joined Telegram shortly afterwards.
- Axel Neff, the VK employee responsible for international development, was involved in the legal work to register Telegram in the United States.
- In May 2012, VK's leading developer and leading designer both left. They joined Telegram shortly afterwards.
- In August 2013, key VK developers responsible for server infrastructure left the company. They joined Telegram shortly afterwards.
Pavel Durov's brother, Nikolai Durov, is also connected closely with the development of the Telegram application, despite being an employee and Chief Technology Officer of VK.Com's Russian operating subsidiary until recently.
UCP's claim states that the development of Telegram, a highly valuable business asset, has been pursued by Pavel Durov in breach of his fiduciary duties to VK.Com and its 100% owned subsidiary VKontakte LLC. UCP believes that he has improperly diverted to himself corporate opportunities which he was duty bound to pursue, if at all, within the business of VK.Com.
UCP also says that it has evidence that Pavel Durov has embezzled VK's funds during the construction of the ICVA data centre and its related contracts.
- Pavel Durov beneficially owns ICVA through offshore companies.
- Companies connected with his stepbrother, Mikhail Petrov, carried out its construction. VK lost c, $5m on investments in its construction, and c.$175K on the loan it granted to ICVA.
- VK has overpaid ICVA c.2.5$m for services and related party transactions involving Pavel Durov and his family.
- VKT Rus LLC, a company founded and controlled by Petrov and Pavel Durov's mother, Albina Durova, was paid c.$4m between 2012 and 2013.
- Petrov also owns Peering LLC, a company that has profited from VK traffic. VK has lost c.$6m of revenue though a contract with this organisation.
Furthermore, Pavel Durov drew a vastly and illegally inflated salary from VK, totalling $6m in 2011-2013. This is ten times more than he was permitted to do, and he also failed to obtain any Board approval for his excessive drawings. His travel and accommodation expenses, charged to the company, exceeded RUB $4.5m.
His behaviour as the company CEO has been also erratic.
- On July 12, 2013 Pavel Durov sent an email where he proposed to vote for Ilya Perekopsky as the new CEO of VK. At the Board meeting on July 25, he withdrew this proposal.
- On March 25, 2014 the Board of VK received Durov's letter of resignation (dated March 21st) from the position of the CEO of "VKontakte LLC". In the letter Durov said that "To make sure my resignation doesn't affect day-to-day operations of the company, I carefully passed all the affairs to my deputies and instructed the key employees of the company." On April 3rd, Pavel sent an email where he claimed to withdraw his resignation.
- On Jan 28, 2014 on his VK page Pavel Durov stated that he sold his 12% stake in VK to Ivan Tavrin. The deal was structured by the sale of ownership in Bullion, the company, which owned 12% stake in VK.com, the holding company of VK business. Later Bullion was acquired by Mail.ru Group. The deal was structured the same way as UCP's deal of acquisition 48% of VK through acquisition of Blesmir and Palagon companies.
- On April 4th, Durov publicly announced, in breach of confidentiality, that Bullion (now a subsidiary of Mail.ru Group) had filed arbitration proceedings in London against UCP and Mail.ru, claiming that the sale of the VK.com stakes UCP purchased in April 2013 from the co-founders was in breach of the company's shareholders' agreement requiring such stakes to be offered to existing shareholders first. This is notwithstanding, amongst other things, that the sale to UCP happened over a year ago and had since gone unchallenged by any of Bullion, Mail.ru Group and/or Durov, and that Bullion had been sold twice over the same period (once by Pavel himself to Tavrin and then to Mail.ru Group) without any offers being made to VK's other shareholders. Also, the fact that Bullion (which is owned by Mail.ru) is purporting to sue Mail.ru as well as UCP demonstrates that this is a tactical law suit.
- On April 16th Pavel Durov posted on his VKontakte page that, because of the situation in Ukraine, he has been under FSB pressure and so sold his stake in VKontakte to Ivan Tavrin as, otherwise, it could have prevented him from making right decisions about the protection of users' personal data. However, in an article published by Vedomosti on April 18th, sources close to Tavrin and USM refuted Durov's statement, saying that the deal was agreed 2 years before it happened and that Durov had an option to sell his stake.
Now Durov has attempted to divert attention from these serious legal challenges presenting himself as a political dissident.
UCP Partner, Yuri Kachuro, believes this tactic is a further demonstration that Durov is a victim of his own fantasies:
"This desperate tactic changes nothing. Pavel Durov has embezzled company's funds and created Telegram using VK's funds and resources. Telegram belongs to VK. We will pursue Pavel Durov and all others involved in Telegram in order to have it returned to its rightful home: as part of VK's portfolio."
Notes to Editors
Through two of its investment vehicles, UCP is a shareholder in VK.Com Ltd, which owns, via a Russian subsidiary, Russia's leading social media website "VK". The other owner of VK is LSE-listed Mail.ru Group Limited. UCP controls 48% of VK.Com while Mail.ru Group controls almost 52%.
UCP's claim is against, amongst others Pavel Durov and Mail.Ru Group Limited
UCP is happy to provide comment on any aspect of its dispute with Pavel Durov. Media enquiries should be referred to Nafisa Nasyrova of UCP in Moscow on +74956431100/ [email protected] or Jonathan Hawker of Slate Campaigns in London on +447979907000/ [email protected]
SOURCE United Capital Partners (UCP)
SYS-CON Events announced today that AppNeta, the leader in performance insight for business-critical web applications, will exhibit and present at SYS-CON's @DevOpsSummit at Cloud Expo New York, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. AppNeta is the only application performance monitoring (APM) company to provide solutions for all applications – applications you develop internally, business-critical SaaS applications you use and the networks that deli...
May. 30, 2016 06:00 PM EDT Reads: 2,659
As organizations shift towards IT-as-a-service models, the need for managing and protecting data residing across physical, virtual, and now cloud environments grows with it. Commvault can ensure protection, access and E-Discovery of your data – whether in a private cloud, a Service Provider delivered public cloud, or a hybrid cloud environment – across the heterogeneous enterprise. In his general session at 18th Cloud Expo, Randy De Meno, Chief Technologist - Windows Products and Microsoft Part...
May. 30, 2016 05:30 PM EDT Reads: 778
The cloud era has reached the stage where it is no longer a question of whether a company should migrate, but when. Enterprises have embraced the outsourcing of where their various applications are stored and who manages them, saving significant investment along the way. Plus, the cloud has become a defining competitive edge. Companies that fail to successfully adapt risk failure. The media, of course, continues to extol the virtues of the cloud, including how easy it is to get there. Migrating...
May. 30, 2016 05:30 PM EDT Reads: 718
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, will discuss the importance of WebRTC and how it enables companies to fo...
May. 30, 2016 04:30 PM EDT Reads: 2,634
As machines are increasingly connected to the internet, it’s becoming easier to discover the numerous ways Industrial IoT (IIoT) is helping to shape the business world. This is exactly why we have decided to take a closer look at this pervasive movement and to examine the desire to connect more things! Now if you need a refresher on IIoT and how it is changing the world, take a moment and listen to Greg Gorbach with ARC Advisory Group. Gorbach believes, "IIoT will significantly change the worl...
May. 30, 2016 04:30 PM EDT Reads: 2,098
SYS-CON Events announced today the Docker Meets Kubernetes – Intro into the Kubernetes World, being held June 9, 2016, in conjunction with 18th Cloud Expo | @ThingsExpo, at the Javits Center in New York, NY. Register for 'Docker Meets Kubernetes Workshop' Here! This workshop led by Sebastian Scheele, co-founder of Loodse, introduces participants to Kubernetes (container orchestration). Through a combination of instructor-led presentations, demonstrations, and hands-on labs, participants learn ...
May. 30, 2016 03:00 PM EDT Reads: 2,079
The IoT is changing the way enterprises conduct business. In his session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, discuss how businesses can gain an edge over competitors by empowering consumers to take control through IoT. We'll cite examples such as a Washington, D.C.-based sports club that leveraged IoT and the cloud to develop a comprehensive booking system. He'll also highlight how IoT can revitalize and restore outdated business models, making them profitable...
May. 30, 2016 02:00 PM EDT Reads: 3,073
SYS-CON Events announced today that MangoApps will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device. For more information, please visit https://www.mangoapps.com/.
May. 30, 2016 01:30 PM EDT Reads: 1,139
SYS-CON Events announced today the How to Create Angular 2 Clients for the Cloud Workshop, being held June 7, 2016, in conjunction with 18th Cloud Expo | @ThingsExpo, at the Javits Center in New York, NY. Angular 2 is a complete re-write of the popular framework AngularJS. Programming in Angular 2 is greatly simplified. Now it’s a component-based well-performing framework. The immersive one-day workshop led by Yakov Fain, a Java Champion and a co-founder of the IT consultancy Farata Systems and...
May. 30, 2016 12:00 PM EDT Reads: 4,120
SYS-CON Events announced today that Super Micro Computer, Inc., a global leader in Embedded and IoT solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Supermicro (NASDAQ: SMCI), the leading innovator in high-performance, high-efficiency server technology, is a premier provider of advanced server Building Block Solutions® for Data Center, Cloud Computing, Enterprise IT, Hadoop/Big Data, HPC and ...
May. 30, 2016 12:00 PM EDT Reads: 809
In his session at 18th Cloud Expo, Andrew Cole, Director of Solutions Engineering at Peak 10, will discuss how the newest technology advances are reducing the cost and complexity of traditional business continuity and disaster recovery solutions. Attendees will: Learn why having a full disaster recovery strategy is more important now than ever before Explore the key drivers of a successful disaster recovery solution Achieve measurable operational and business value from a disaster recovery ...
May. 30, 2016 12:00 PM EDT Reads: 1,504
How will your company move to the cloud while ensuring a solid security posture? Organizations from small to large are increasingly adopting cloud solutions to deliver essential business services at a much lower cost. According to cyber security experts, the frequency and severity of cyber-attacks are on the rise, causing alarm to businesses and customers across a variety of industries. To defend against exploits like these, a company must adopt a comprehensive security defense strategy that is ...
May. 30, 2016 11:30 AM EDT Reads: 797
SYS-CON Events announced today that Hanu Software will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Leveraging best-in-class people, processes, and technologies, Hanu provides high-quality, high-value software development and business process outsourcing services to independent software vendors (ISVs) and enterprises.
May. 30, 2016 11:30 AM EDT Reads: 1,477
What a difference a year makes. Organizations aren’t just talking about IoT possibilities, it is now baked into their core business strategy. With IoT, billions of devices generating data from different companies on different networks around the globe need to interact. From efficiency to better customer insights to completely new business models, IoT will turn traditional business models upside down. In the new customer-centric age, the key to success is delivering critical services and apps wit...
May. 30, 2016 11:15 AM EDT Reads: 1,353
Join us at Cloud Expo | @ThingsExpo 2016 – June 7-9 at the Javits Center in New York City and November 1-3 at the Santa Clara Convention Center in Santa Clara, CA – and deliver your unique message in a way that is striking and unforgettable by taking advantage of SYS-CON's unmatched high-impact, result-driven event / media packages.
May. 30, 2016 11:00 AM EDT Reads: 2,585