Abramovich's vacation: what the billionaire did with money earned from the sale of "Sibneft"

The Chelsea owner says that the main thing in life is freedom. Can this approach make a successful investor?
27.09.2013
Forbes
Origin source
«Are you Abramovich?» - putting the accent on the second syllable, asks a 5 yo black boy and stretches the hand out for an autograph. In June 2010, in Johannesburg, Russia presented a bid to host the World Cup in 2018. Abramovich was called by an old friend, the first Deputy Prime Minister Igor Shuvalov. And made no mistake. "It had to be seen; only the lazy ones didn't try to approach Roman. David Beckham abandoned his English stand and immediately joined us," recalls a member of the Russian delegation with delight. 
The most popular Russian celebrities Abramovich began in 2003, bought the London Chelsea. Two years later he had his main trade - has sold for $ 13.1 billion "Sibneft" "Gazprom". Thanks to Abramovich set a record for three consecutive years remaining on top of the Russian Forbes list with a fortune of about $ 20 billion.

Overshadowed by this triumph could only Boris Berezovsky, who tried to sue Abramovich's $ 5.5 billion. Nine days of interrogation in the hall packed to the High Court in London for Abramovich turned into one of the most difficult tests in life. But now it is no longer necessary to "fly freedom & raquo ;. In addition, Abramovich had just said goodbye to Chukotka.
Unlike most of its neighbors on the Forbes list, he seems to really value freedom above money. Can this approach to be a successful investor?

Family office

"It was a good company. Staff great, the team is small, all at business, and decisions are taken quickly - almost family office », - describes the experience of" Sibneft ", the former deputy chairman of" Gazprom "Alexander Ryazanov. He headed the company, renamed later in "Gazprom Neft", immediately after purchasing it.

For 72.66% of the shares of "Sibneft" "Gazprom" has paid $ 13.1 billion (a little less than five annual profits). As follows from the testimony at trial with Berezovsky, the sole beneficiary of this package was Abramovich. If so, as a dividend for the five years before the "Sibneft" transaction total paid him about $ 4.6 billion.

The team ran the "Sibneft", could also capitalize on its sale. Bonus Shvidler, Abramovich's right hand and his head of Millhouse CEO as utverzhdaet his good friend, it amounted to about $ 1 billion (Shvidler he is not commenting).
The amount paid for the "Sibneft" money was unprecedented at the time (at the beginning of August 2013, the company is already worth about $ 17 billion). The whole market is discussed, that all the money Abramovich could not get: a part of the sum could get his patrons, close to the authorities. Especially since the transaction took place against the backdrop of the largest in the history of Russian business drama - Abramovich "obkeshilsya", when Mikhail Khodorkovsky two years sitting in prison, and the assets of his company Yukos began to sell by auction.

Abramovich in this grim story was not just a bystander. In 2003, two years before the deal with "Gazprom", he and Khodorkovsky agreed to merge their companies. The resulting "YukosSibneft" has become the world's largest private company in terms of reserves. In the next stage of the company's shareholders had hoped to sell a stake to one of the majors of the world (with the negotiations were Exxon and Chevron). But after the arrest of Khodorkovsky in 2003, these plans have failed.
Familiar Abramovich told that the arrest appeared tohis surprise: Khodorkovsky's partner, Platon Lebedev, was detained in July 2003, and yet, no one expected that the "Yukos case" go so far. Abramovich allegedly even tried to stand up for Khodorkovsky before Putin, but quickly realized that it was useless.

But what Abramovich is not exactly going to do is take a chance, "Sibneft" due to "the mistakes of others." Soon after the arrest of Millhouse unilaterally launched the procedure for "divorce" with YUKOS. Regain 72% of the 92% shares of "Sibneft" Abramovich was only in 2005, and within a few months, he shook hands with the head of "Gazprom" Alexei Miller.

shopping billionaire

Having so much cache Abramovich behaved like a kid in a toy store. He bought himself an expensive London real estate (according to British media, the amount of about £ 40 million), including two of the mansion in the prestigious Belgravia. I ordered a new yacht, the Eclipse 163.5-meter (at least $ 475 million), and one of four old, 113-foot Le Grand Bleu, presented Shvidler. I went to the alpine resort Lanserhof: 10-dnevfirst vacation as written local newspaper, Abramovich has paid more than $ 1 million, than the staff brought to a screeching halt - average customer over the same period of leave not more than $ 4,000.

Living expenses Abramovich (other than expenditure on football) and now must be not less than $ 60-70 million a year, estimates one of the participants in Forbes list. "Roma says that in general all this [business] did just that you can not think about the money and do what you want. He lives - says billionaire friend. - He and "Sibneft" sold, because all of his team were tired, no one wanted nothing more to manage. "

For Abramovich bought Chelsea striker Andriy Shevchenko (one shuttle cost $ 59 million) and many other new players. He managed to convince everyone that the Russian national football team needs a foreign coach, and began to pay the salary invited Guus Hiddink (about € 7 million a year, "clean", it was the most expensive contract in Europe).

Abramovich certainly had no plans to return to the big business. But in the same 2006 he turned up a chance that it was a pity to miss: to co-giantskoy international company.

Heavy metal

In spring 2006, Alexei Mordashov has signed a deal to merge "Severstal" with European Arcelor: upon its completion it became the largest shareholder of the largest steel company in the world. "This is a step forward for all of Russian business" - proudly said Mordashov, still unaware that he just used. Based on an agreement with the "Severstal», Arcelor stuffed his worth in the negotiations with the other candidate - steel magnate Lakshmi Mittal. When he raised the price from Mordashov was only one option -. Buy Arcelor entirely for € 30 billion kind of money he could not collect, and then to "Severstal" owner Abramovich came people.
With this asset as of Arcelor, as a major, but not a senior partner Abramovich could enjoy their freedom to the end. In the oil industry after the "Yukos case", he did not want to invest.
Besides metals it has been associated with one of its most successful transactions. When in 2000, Lev Chernoy and his partners sold the shares of aluminum smelters, Abramovich, Berezovsky and BadriPatarkatsishvili intercepted them Oleg Deripaska, and then asked him to merge. Deripaska's company was smaller and had to pay $ 575 million. These money Abramovich and his partners paid off with the Black, that is, the plants themselves have got them for free. Three years later, Abramovich sold Deripaska his 25% of the resulting company "Rusal" for $ 1.58 billion.
But with Arcelor failed. At the crucial moment he changed his mind Mordashov. "He just got scared, because Roma gave him the condition that, even if the deal with Arcelor fail, Mordashov will have to put it in the" Severstal ", - says one of the closest friends of Abramovich. Arcelor Mittal eventually bought. Mordashov on Forbes did not answer questions, but Millhouse said the deal with Arcelor did not take place on a "purely commercial reasons" and the acquisition of shares in the "Severstal" out of the question.
Even before the junction with the history of Arcelor, the summer of 2006, Abramovich and Shvidler for $ 3 billion bought 41% Evraz Group from its founder Alexander Abramov and Alexander Frolov. Then it was the fifth largest company in Russia.

Large Evraz

Talented graduates MIPT, Abramoand in Frolov, from the late 1990s, the company built on the basis of disparate assets, then bought the share of partners, including billionaire Oleg Boyko. Before Abramovich's Evraz has been very conservative in terms of shopping. As Abramov said in an interview in 2004, the company has never had debts that could not pay off for a year. But already in 2005 on a wave of industry consolidation Evraz joined in the race for the asset, and the emergence of new money partner seemed logical. With the arrival of Abramovich transactions M & A, in fact, went one after the other. For Evraz purchases using credits.

The company literally inflated assets: in 2007 for $ 2.3 billion Evraz bought US Oregon Steel, for $ 870 million - 50% "JUzhkuzbassuglja" and a number of smaller assets. Its net debt in the year increased by 5.5 times, to $ 6.28 billion in 2008, the marathon continued:. The company has acquired the company in the United States, South Africa, Russia, the Ukraine, and its debt rose to $ 9 billion, of the Board of Directors. Evraz for uncontrolled growth of the company watched Shvidler and two more representatives of Abramovich.

While steel prices have been rising, "pumping" of investors is not embarrassing. On the contrary, they liked of Evraz, which pleasedincreasing their profits and dividends. In 2007, the company's market capitalization has reached $ 30 billion, of Evraz became the most expensive steel company in Russia and the fourth - in the world, but only NLMK inferior in terms of profitability. By May 2008 it reached a record value of $ 46 billion - Millhouse package worth 5.6 times more than was paid for it. And then the crisis hit, stock exchanges fell, investors became panic-stricken.

Not calculate the credit load Evraz has suffered more than most: in November 2008 its market capitalization fell to a mere $ 1.95 billion of securities holders feared that the company can not pay its debts: production decreased by 50%, the price of steel - by 40%.. In time helped VEB issued a loan of $ 1.8 billion. Top management of the company, led by Abramov agreed with creditors in 2009 reduced the debt by $ 1.14 billion. To put out short-term loans, the company released the new bonds.

Evraz had rescued and Shvidler with Abramovich. In July 2009, they bought the bonds and GDR company for $ 200 million (the same amount spent for this purpose Abramov with Frolov). As I told Forbes one of the investment bankers, who watched the of Millhouse, to theth time in its portfolio were other bonds of Evraz - about $ 130 million (Millhouse is not commenting).
Evraz to stay afloat, but the crisis has not recovered, has occupied the second place among the most troubled steel companies in Russia. Worse things are so far only in "Mechel" Igor Zyuzin.

Old scores

All this time, the High Court of London lay filed back in 2007, Boris Berezovsky sued. He wanted to get away from Abramovich compensation for the fact that he allegedly underpaid him and Badri Patarkatsishvili, the old partnership. In 2010, the court finally accepted the claim for consideration, and there is a real threat of losing a large sum to Abramovich.

The last payment received from Abramovich Berezovsky in 2001. All the $ 13 billion received in the "Sibneft", passed by Berezovsky, and for the package in the "Rusal" he had received from Mr Deripaska three times less than Abramovich. It's not fair, I decided to Berezovsky and billed - $ 5.5 billion.

"Can not believe it, but Abramovich has long continued to believe Berezovsky's friend," - says an acquaintance of both. The fact that the former partner is preparing a lawsuit, Abramoichu Patarkatsishvili said, "Badri himself as he could, persuaded Berezovsky not to do so." With Abramovich Patarkatsishvili spoke to his death from a heart attack in 2008.

Version Abramovich in court: Berezovsky and Patarkatsishvili were for him only a "roof", which he since the establishment of "Sibneft" in 1995 and transferred to a separation of about $ 2.4 ppb "I bought their freedom," - he explained to these payments court, insisting that paid off.
None of the parties could not provide the court confirming its position papers, and Judge Elizabeth Gloster was forced to disassemble the classic dispute "word against word." The evil one, both, no doubt the majority of respondents Forbes business know Abramovich and Berezovsky 1990s. "Even in the absence of securities, we all know that they were partners in everything, - says one of them - but the position of Roma was that he h