Russian oligarch backed fund LetterOne files lawsuit against private equity firm that cut ties following war in Ukraine

The Luxembourg headquartered investment fund founded by sanctioned Russian oligarchs Mikhail Fridman and Petr Aven has filed a lawsuit against the London private equity firm that manages $5bn (£4.2bn) of its money.

Multi-billion-dollar investor LetterOne is taking legal action against Pamplona Capital Management in calling on the private equity firm to open its books, after Pamplona made efforts to cut ties with the oligarch backed firm.

Pamplona in March said its relationship with LetterOne “increasingly challenging” for its “portfolio companies, their management teams, customers, employees, and counterparties,” after the EU sanctioned both Fridman and Aven in February, following Russia’s invasion of Ukraine.

Both Fridman and Aven later stood down from their positions at LetterOne, as they handed control over the firm to former Labour minister Lord Mervyn Davies. There are currently no sanctions imposed on LetterOne.  

In May, Pamplona hired US investment bank Jeffries to help it cut its links to Russia, as the firm also opened talks with US investment giant Apollo Global Management in its bid to replace LetterOne.

A spokesperson for LetterOne said the firm had decided to take legal action as a “last resort” in response to Pamplona’s “ongoing and unjustified refusal to share information with its largest limited partner”.  

LetterOne continued in claiming that Pamplona’s “unilateral action” threatens its material interests, as the firm said its repeated efforts to engage with Pamplona on its “proposed actions” had been “rebuffed, dismissed, or ignored”.

In response to LetterOne’s claim, Pamplona said it was “puzzled” by LetterOne’s request that it open its books, as the private equity firm said it has given over all the information LetterOne are “entitled” to under the Limited Partnership Agreement between the two firms.

The Pamplona spokesperson said that last year it “successfully completed a disposal that was substantially greater than anything that could arise out of the Jefferies strategic review, currently under way.”