Shares in Russian business conglomerate Sistema slumped by as much as 17 percent early on Tuesday, after a Russian court froze some of its assets as part of a legal dispute with oil company Rosneft.

Rosneft is suing Sistema for 170.6 billion roubles ($2.9 billion) in damages following its purchase of oil producer Bashneft last year. The dispute between Sistema and Rosneft has rekindled investor fears from 2014, when the Russian government seized Sistema’s stake in oil firm Bashneft, saying Bashneft’s privatisation had been illegal.

Rosneft says assets were removed from Bashneft when it was owned by Sistema. Rosneft’s spokesman said late on Monday the freezing of Sistema’s shares was a “security measure”.

A spokesman for Sistema, which is controlled by Russian businessman Vladimir Yevtushenkov, said on Monday that Rosneft’s demands were groundless and that Sistema was facing unprecedented pressure.

Sistema has now lost almost half its market value since Rosneft filed its lawsuit against the firm in May.

As of 0800 GMT, Sistema’s Moscow-listed shares had pared their losses to trade down 8.4 percent on the day, while those of the MTS telecoms firm in which it owns a large stake were down 3.7 percent.

Equity analysts said the Sistema-Rosneft dispute would cast a pall over the broader Russian market.

“However the further fate of this case develops, such news erodes the hopes of market players for a favourable investment climate in future,” said Alexei Antonov at Alor Broker.

Russia’s rouble-based MICEX index was 0.1 percent lower at 1,858 points, while the dollar-denominated RTS index was also down 0.1 percent to 991 points.

According to a court order, a 31.76 percent stake in MTS owned by Sistema has been frozen, 100 percent of its Medsi chain of medical clinics, and 90.47 percent of the Bashkirian Power Grid company owned by Sistema and its unit Sistema-Invest.

VTB Capital analysts said that after the court injunction Sistema would receive significantly less dividends from MTS, one of Sistema’s prize assets, adding that they were reviewing their recommendation on Sistema’s shares.

On the currency market, the rouble fell on Tuesday, hurt by nervousness over Sistema and after Russian firms had made the bulk of their monthly tax payments.

The rouble was 0.4 percent weaker against the dollar at 59.01 and had lost 0.5 percent to trade at 66.01 versus the euro.

The Russian currency fell despite prices for Brent crude oil, a benchmark for the country’s main export, rising by 0.6 percent to around $46.1 a barrel.

Sergey Kopytov, Sistema’s spokesman told CNBC via email on Tuesday, “These measures have only one objective and this is to apply unprecedented pressure on our company”.

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