LONDON, Dec 11 (Reuters) - Kazakhstan Kagazy Plc’s paper making operations in Almaty, Kazakhstan have been raided and accused of criminal activities and tax evasion by financial police, the London-listed company said on Wednesday.
The raid comes as the maker of paper, board and packaging battles former shareholders and directors Maksat Arip, Baglan Zhunus and Shynar Dikhanbayeva in a London court where it accuses them of fraud.
Kagazy said in a statement there appeared to be a link between its London legal action, where on Nov. 20 the High Court upheld a $100 million freezing injunction over assets of Arip and Zhunus, and the raid.
“Since the injunction was upheld in London, the Kagazy group has come under increased scrutiny from state authorities. However, today’s raid on the business shows a dramatic escalation in the level of pressure being applied against the company.”
The raid represents “clear disregard for due process and the rule of law” and it “jeopardises Kazakhstan’s ability to attract foreign direct investment from multinational businesses like Kazakhstan Kagazy,” the statement quoted a spokesman saying.
Kagazy’s main shareholder is now its chief executive, Thomas Mateos Werner, a former banker and partner of wealth management firm Werner Capital, who holds 29.9 percent.
In the London High Court Case, Isle of Man-registered Kagazy accuses its former chairman Arip, chief executive Zhunus and finance director Dikhanbayeva of stealing $135 million from the company. All three deny the accusations.
Court documents say Arip and Zhunus originally owned 50 percent each of Kagazy, but reduced their holdings in the late 2000s. Arip, the papers say, is from Kazakhstan but now has dual Cypriot/Saint Kitts and Nevis nationality.
Kagazy had an initial public offering of shares in London in 2007 raising $273 million. In 2009, it ran into financial trouble and its controlling shareholders changed ahead of a debt restructuring agreement that was finalised with most bondholders and creditors in 2011.
Its shares were worth a total of about $12 million at the close of trading on Wednesday.
Arip is also the founder of Russian oil producer Exillon Energy Plc, another company whose shares are listed in London. He approached Exillon about repurchasing it earlier this year, but later sold his stake to Russian businessmen Alexei Khotin who is considering his own approach for the company.