How vodka tycoon Yuri Scheffler lost Russia and conquered the world

Over 12 years of forced exile, SPI Group owner has entrenched on the international market, increased his wealth to $ 1.75 billion and kept good relations with a half of the Forbes list.
21.05.2015
Forbes
Origin source
Over the grassy dunes seen the Baltic Sea and the deserted beach. "There is stunning natural surroundings, look what's a beautiful sunset! And it was now the northern lights last night! "- Exclaims the owner of SPI Group Yuri Scheffler, climbing on a sand hill. Along the way he asks questions about what "happens in the capital of our country." The businessman was not in Moscow almost 13 years - accused of misappropriation of the former Soviet alcohol brands, he was forced to leave Russia. Having lost part of its business, Scheffler sued for trademark rights in many countries. The proceedings have not yet been completed, SPI Group has recently lost a court in the Netherlands. But its owner looks pleased - Company c net annual revenues of $ 500 million in expanding, producing vodka, wine, champagne and balms. The next rum and whiskey. As an entrepreneur, still ranking in the international wanted list, is building a business outside of Russia?

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In one of the shops of the plant Latvijas Balzams is the sweet smell of vanilla. But here not produce confectionery and flavored vodka Stoli. At this time, vanilla. On the territory of the plant is a dead-end branch of the railway. This "Talvis" enterprise from Tambov come train with alcohol, made on owned SPI Group. And in Riga, diluting alcohol with water from the well, make vodka. Rows of tall, narrow bottles floating on the conveyor belt in an adjacent room, where they were packed in boxes and ready to be exported to America. SPI Group supplies in the US, about 20 million bottles of Stoli a year - 5.5 times more than were sold "Capital" in 1979 when it became the most popular imported vodka in the United States.

"Scheffler - lucky! After securing this business, he did not even realize what a treasure he gets "- exclaims a former top manager of the plant, pours vodka" Stolichnaya "in the early 1990s. The owner of SPI Group started with the same, and that many billionaires: selling computers bought vouchers. Simultaneously, he studied at the Economic Academy. Plekhanov. In 1993, agreeing with the Swiss Hopf, he created a trading house "Sadko Arcade". Then, with other partners, has acquired a blocking stake of JSC "Vnukovo Airlines", as well as shares of GUM and TSUM.
Thesis in 1996, he wrote about his own experience of the management, for which unexpectedly won the praise from professors who knew capitalism only in theory.

"I myself did not understand what industry I like, where I can find a use, so try everything," - says Scheffler.

One partner introduced him to Vladimir Yamnikovym, general director of distillery "Kristall".

Yamnik persuaded a young entrepreneur to do in buying shares of JSC "Souzplodoimport" awaiting restoration of their rights to a number of vodka brands -. "Moscow", "Wheat", "Russian", "Stolichnaya", etc. In 1991, the Patent Office of the USSR has deprived them of legal protection in the territory the Soviet Union, recognized as well known. Along with the "crystal" and enterprises, especially vodka is bottled under license to produce "Moskovskaya" and "Stolichnaya" could all Distillery. General Director of "Soyuzplodoimport" Eugene Sorochkin Vladimir Yamnik ( "Crystal" owned shares in HLW) have made the lifting of Patent Office.



Faced Scheffler, General Director of "Crystal" has found an ally, inspiring his idea to build an international business. In the year 2000 ended with agreement "Soyuzplodoimport" with PepsiCo. Sorochkin as telling his friend, dreaming about how to conclude a new contract on more favorable terms and be able to receive part of the profit, which settled at PepsiCo. And I do not keep track that loses power. By 1997, Scheffler has consolidated 80% shares of JSC "Souzplodoimport" and on the board of directors meeting shifted Sorochkina (alas, Yamnik could not celebrate the victory - in January 1997, he died due to illness).

Tried everything businessman sdelAl choice. Yuri Scheffler Suleiman Kerimov has sold its shares in "Vnukovo Airlines" and "Nafta-Moscow". I parted with shares of GUM and TSUM. Out of the founders of "Sadko Arcade" (restaurants, supermarkets, fashion stores). But to pay its debts "Soyuzplodoimport" suffered vodka production in Kaliningrad to "Rosvestalko" and began to fight counterfeiting factories, ignore the fact that the brand ceased to be "common knowledge".

Having found that, in many countries, such as Australia, Spain, Argentina, the rights to the brands do not belong "Soyuzplodoimport" Scheffler has spent more than $ 45 million for their redemption and re-registration. In 1998, he instead created VAO ZAO (the name of the company at the same time missing one letter "o" - "Sojuzplodimport") and sold the rights to the trademarks of their Dutch company Spirits International. Business and legally become international.

"We made money in the West and had to sell the currency earnings, - explains Scheffler. - But to be able to spend it on promoting brands abroadWe restructured the group. " The new group of companies called the SPI Group.

Blow Bang Bang

"These figures carried out privatization ugly and legally defective" - ​​complained in an interview with Forbes Yuri Zhizhin, former (until 1987) the head of the "Soyuzplodoimport" meaning events of 1990. When the Soviet foreign economic society was transformed into a joint stock, Eugene Sorochkin did not create a commission to evaluate the assets. The assignment of rights to 43 brands of vodka cost Spirits International at 1.7 million denominated rubles - that is, according to Yuri Scheffler, had their carrying value.

For the time being the flaws in the privatization of Soviet brands Russian authorities did not care. In the fight against counterfeiting of CJSC "Sojuzplodimport" ( "SPI") supported the Prosecutor General's Office, and the Supreme Arbitration Court are regularly awarded the company to pay the debts of its predecessor. Speaking about the event, the owner of SPI Group and now does not go into details. It all started with the visit of the representative GUBEP wish to review the export documents.

"They came, checked, seized upumenty, then wanted us to sell the brand "- says Scheffler.

In 1999, in "Sleep" has passed 28 searches. After that, to the Acting President of Russia Vladimir Putin came a letter from the Minister of Internal Affairs Vladimir Rushailo and Prosecutor General Vladimir Ustinov. Officials have drawn attention to the fact that the trademarks, former national property, were in private hands. In March 2000 (oddly enough, on the eve of the elections), Putin instructed to deal with this and take steps to protect the rights of the state. The company Scheffler took the Accounting Chamber, in November 2000 and handed down the verdict: the privatization carried out properly. Because can not be held.

Auditors proposed to deprive the "SPI" rights in the Soviet signs and transmit them to the control of "Rosspirtprom", consolidated the state's share in the distillery plants. The Supreme Arbitration Court in October 2001, supported the position of the Chamber of Accounts. "Scheffler knew Sorochkin illegally obtained trademark" - insists the former top manager of the plant, which produced "Stolichnaya". Yuri Scheffler argues:if the privatization was carried out with violations, he could not know about it, because it bought shares HLW many years after incorporation.

Two weeks after the verdict of the EAC, following the request of the Deputy Agriculture Minister Vladimir Loginov, Rospatent reregistered 43 vodka brands in the Ministry of Agriculture. However, 26 of them soon returned - they were registered after the collapse of the USSR (varieties of major brands - like Stoli Persik). Yuri Scheffler filed appeals, but to no avail. In 2002, the brand transferred to the specially created federal state enterprise "Souzplodoimport", which was headed by Loginov.

"This was the first open-de-privatization. Even then it was obvious that if they came for me, they can come and for the oil industry, and metallurgy ", - says Scheffler. "Nobody did not cling to him, because he was not a political figure, - says representative of the vodka market, close to the PCF" Souzplodoimport ". - Just lucky he was to get the most valuable brand, created in Soviet times, hardly disinterested. " Vladimir Loginov, now head Aentstva on innovation and the development of the Voronezh region, on Forbes request is not answered.

Yuri Scheffler and SPI Group general director Andrei Skurikhina initiated criminal case under Art. 180 of the Criminal Code ( "Illegal use of a trademark" - up to six years' imprisonment in the case of a crime by a group of persons in collusion). The businessman was charged and even death threats - allegedly in conversation with Loginov on the phone. But take under arrest did not have time. "In July 2002, my senior friend said: go. I immediately went to the airport. And since 13 years was not in Russia, "- with a barely perceptible nostalgia says Scheffler.

The market for expat

At SPI Group owner has a house all over the world: at home in London and Miami, the villa on the French Riviera, the two house in Jurmala - the former residence of the governor of the Russian Emperor in Latvia and modern house made of wood, glass and concrete, built around a century pine. Yuri Scheffler - an indispensable guest of Jurmala festival "New Wave", which regularly are billionaires Mikhail Fridman, Pyotr Aven, Oleg Boiko, Nikolai SarKish, David Yakobashvili.
The general sponsor of the "New Wave» - Latvijas Balzams. Check the manufacturer's package of the famous "Riga Black Balsam" Yuri Scheffler bought in 2001 from the former Prime Minister of Latvia, Andris Skele. And shortly before his escape from Russia, he launched the production of "Metropolitan" in Riga. "I focused on the alcohol business finally realized that this is exactly what I like - smiling businessman says. - He's an interesting, dynamic, lively, creative. "

Without the Russian market, he has kept American Scheffler. In 2000, he signed a ten-year contract for Stoli sales in the US with the company Allied Domecq - at the price of deliveries more than double the previous. Although Stoli Smirnoff ceded leadership, the second place among imported vodkas in the US it is held firmly. In the mid-1990s, it was engaged in promoting a marketer Michel Roux, untwist Absolut on the world market. For Stoli, he came up with an advertising campaign in the spirit of socialist realism ( «Freedom of vodka!»), And proposed the idea of ​​flavored vodkas for cocktails (SPI Group has released their first in the world, and now flavored variants Comditsya 40% Stoli sales in the US).

Allied Domecq tried to make Stoli even more fashionable. The campaign reached more than a dozen of the most popular magazines, including Vanity Fair, GQ, Vogue, Interview. In 2000, Stoli sales measured in millions of dollars in the US, two years later - the tens of millions.

In 2003, SPI Group has introduced super-premium vodka Elit by Stolichnaya (about $ 60 per bottle). Label - a tongue of flame, enclosed in a triangular piece of ice, - Yuri Scheffler painted by myself, recipe invented one of the most experienced employees of Latvijas Balzams. The presentation of vodka in a friendly circle businessman held in September 2002 in Sardinia. Despite the status of a "fugitive", his two-day party Sardinia Russian Party and Stolichnaya Elit Opohmel Party visited Mikhail Prokhorov, Roman Abramovich, Andrei Melnichenko, Alexander Mamut and other well-known entrepreneurs, financiers, artists.

Artem Kuznetsov, co-owner of "Guta" long familiar with Yuri Shefler, characterizes it as "a wonderful manager, with the departure of the Russian business which the country lost a lot."

"I think that half of the listForbes can say about him but good, and the other half just is not familiar with it ", - he says.

One of the first half of the billionaires list, Forbes replied to the question: "Scheffler - a brave guy, was not a crook."

In addition to the many friends in Russia Yuri Scheffler remained assets - for example, 32% of the shares in OAO "Moscow City". But to manage them from abroad was problematic, so alcoholic magnate sold them, leaving only alcohol producer - Tambov "Talvis". Partnership with a distributor in the US, he was satisfied and concluded in 2004 with the Allied Domecq agreement Stoli sales in other countries - the major markets alcoholic.

In 2006, the number of formal wanted (on the line and the Prosecutor General, and Interpol), Scheffler bought Perm Distillery "Permalko". "He is like the elusive Joe, which is really no catches - ironically Forbes source of the vodka market. - Regulated industry, just that - a license is taken, and his factories work, make alcohol. Only "Souzplodoimport" to fight him, and then abroad. "

losertion rate

PCF "Souzplodoimport" Not a day relaxing since the departure of his opponent. While SPI Group and Allied Domecq tried to surprise western consumers, "Souzplodoimport" initiated legal proceedings for trademark rights abroad - only 40 countries on all continents (of course, except Antarctica).

As assured in the BDS, the state does not fund the courts with SPI Group - «Souzplodoimport" spend what he earns on sales of vodka in Russia and exported to 15 countries. Part of the costs paid alcohol distributors, who promised contracts for exclusive sale in the case of a successful solution to the dispute. In some countries, state-owned company does not spend money at all - lawyers work for a percentage of potential future gains. How to assure "Souzplodoimport" for more than ten years of legal fees paid by now, amounted to only 173 million rubles.

Yuri Scheffler recognizes that the courts in all countries have spent about $ 200 million, including $ 80 million in the United States, where the real costs opponent is estimated at $ 40-50 million. Despite thelitigation, influenced the reputation of the business, things went bad SPI Group - in 2004 its turnover amounted to $ 600 million (the lion's share of Stolichnaya brought in all cases).

"I always wanted to own a global company," - says Scheffler.

In the second half of the 2000s he had a chance to become the owner of a very large international business.

In spring 2005, the French alcohol company Pernod Ricard and Fortune Brands US announced the acquisition of Allied Domecq brands and under its portfolio. Global distribution of Stolichnaya and all other SPI brands wanted to take a Pernod Ricard. According to the report Pernod Ricard in 2006, the company agreed to pay the SPI Group $ 155 million for the exclusive rights to distribute and the right to buy the Stolichnaya brand, if Scheffler decides to sell it.

The French claimed even more - would resolve the conflict with "Souzplodoimport" to sell "Stolichnaya" and even in Russia. "The late Patrick Ricard said that the agreement with the Russian side should not care about me: French President Nicolas Sarkozy became, and Patrick asked him to discuss Mr.a meeting with Vladimir Putin the opportunity to resolve the problem ", - explains Scheffler. Himself Ricard, former Chairman of the Board of Directors of Pernod Ricard, in an interview with "Kommersant" in 2008, mentioned that the issue of Stolichnaya raised in conversation Sarkozy and Putin.

As Scheffler says a possible deal gave the green light. SPI Group and "Souzplodoimport" year suspended all legal proceedings, and Pernod Ricard sat down at the negotiating table with the two sides. "The talks were conducted and a half years, including at the highest level", - says Igor Alyoshin, the current CEO of the PCF "Souzplodoimport" without disclosing details.

While Pernod Ricard trying to get his in Russia, problems have arisen in the US market. Roustam promoting their Imperia vodka and Russian Standard, touting them as the only true Russian vodka in the United States. Pernod Ricard has made a court ban on the advertising campaign. Tariq also filed a lawsuit response, requiring the SPI Group to reveal where and how it produces vodka, which he calls the Russian. Only in 2010, Pernod Ricard and the band signed a settlement agreeing Roustix, abandoning the mutual claims.

The talks ended in Russia? "Sojuzplodimport" proposed the creation of a joint venture with Pernod Ricard, which would be owned and operated vodka brands worldwide. Yuri Scheffler, according to him, could become a shareholder of Pernod Ricard, received 12% of the shares (valued at nearly $ 2.5 billion), and about $ 1 billion in cash. At the same time he was trying to negotiate the conversion of cash into shares, to acquire an additional 8% Pernod Ricard.

The deal fell through. The Swedish government put up for sale in 2007, Absolut - Vodka brand №2 in the world. The French have decided that it is better to spend time and energy on the purchase of Absolut. Perhaps there was another underlying reason: SPI Group CEO Andrew Skurihin then publicly announced that Vladimir Loginov of "Soyuzplodoimport" promised to withdraw all claims, if they are considered "his interests." His words were confirmed by Scheffler (Skurihin himself refused to comment, explaining that "neither SPI Group, no alcohol business as a whole is no longer included in the scope of his interests"). Familiar Loginova claims that the before the trip for talks with SPI warned law enforcements authorities about possible provocations in his address.

Jack Shea, Vice-President, Communications Pernod Ricard US, said of Forbes, that the company "will never comment on rumors about possible mergers and acquisitions." In the "Souzplodoimport" to the question about the cause of failure of the deal say it is well known and widely reprinted in the press - of course, due to Absolut.
Following the purchase of Absolut French terminated with SPI Group distributor contract. As Scheffler says, Pernod Ricard paid him $ 80 million penalty. He tried to negotiate exclusive distribution and even sale of the brand to Fortune Brands, but those scared conflict with Russian officials and unclear the fate of the brand. Negotiations with other international players, too, do not ask.

Stolichnaya was left without a global distributor, and Scheffler and his managers were forced to quickly search for partners in all countries where vodka supplied before. "Then I realized that as long as there will be problems with Russia, I am not selling the business - sigh alcoholic magnate. - Well, we have to work on, look for options. "

No anguish, no pity </ Strong>

Enjoying dinner in his house Jurmala glass of Italian Ornellaia, Yuri Scheffler with undisguised pleasure tells about the deal in 2006, when he became co-owner of the house wine Tenute di Toscana, belonging to the Marquis Frescobaldi family. For the 25.8% he paid about € 34 million. "The grapes are grown by many generations, and older than he is, the better the wine. Therefore, to buy the company this level is very difficult - he said. - Over the last 600 years, I was the first foreigner who has acquired a stake in the winery in Tuscany. "

At Villa Collazi, owned by Tenute di Toscana, and, according to legend, built by Michelangelo Buonarotti, daughter Sheflera Lada two years ago to marry. Her father at that time acquired shares in the Argentine winery Achaval Ferrer, and recently for € 13.5 million to buy out the Spanish economy Arinzano. The wine business - is that a small portion of the holding Scheffler, but he's ready for five-six years to spend $ 300-400 million for the acquisition of other enterprises. Wine does not make a lot of money, says the businessman, but adds capitalization, besides this "nice people, beautiful place";.

After her divorce from Pernod Ricard Stoli distribution in the US market was engaged in the Scottish William Grant & Sons. And in 2012 Scheffler decided that SPI Group will sell its own vodka in the United States. On licensing, the creation of Stoli Group, the establishment of marketing linkages took a little more than a year and about $ 200 million.

The US market for of Stoli, as many years ago, the main, it accounts for up to 70% SPI profits now vodka, lost after the "Soyuzplodoimport" another suit in 2011 to be called "Russian", positioned as "imported". Half of the sales are in bars and restaurants, so Stoli struggling to capture the attention of bartenders (for they have come up with a training program) and visitors - for example, released a vodka label, luminous in ultraviolet rays.

As recognized by the owner SPI Group, the company's operations, he is not immersed - managers understand this more.

"But the creative part, I actively participate. That autumn launch restyled, the new label - a miracle for some! "- Exclaims entrepreneur.

Wand the last three years Scheffler had time to participate in a consortium of investors led by A1, wishing to purchase alcoholic holding of CEDC, and kept an eye on for sale on producer Whyte & Mackay whiskey. Both transactions for various reasons did not take place. Who will host Scheffler is a "good brands of rum and bourbon", negotiations with producers. SPI Group is transformed into a diversified holding company? Businesswoman nods, but specifies: "We do not want to type anything and everything - spirits in the premium segment, which can fall in love with the same consumers that love and Stolichnaya. It is very important".

Although the courts of the former Soviet brands continues with Sheflera removed almost all the charges - in the illegal business, organizing a criminal group, legalization of illegally acquired means, murder threat. It remains only to proceedings under Article 180 of the trademark that does not interfere with Shefleru safely travel the world on his yacht Serene.

When the end of the proceedings with brands? In "Souzplodoimport" give a cautious outlook: in the European market - in the next three-coupleD year. SPI Group Owner briefly replies: "I do not know." "If, then, I was able to become a co-owner Pernod ... - He thinks for a moment. - But it did not happen, and I do not regret. "