A trading empire under the name of Magnit, which belongs to the businessman Sergey Galitsky, demonstrates a rapid pace of the deterioration of the revenue. For the first time throughout the existence of the chain, the company's net profit declined. At the end of 2016 the indicator of Magnit according to international accounting standards fell at once by 8%, to 54.3 billion rubles. Even according to the most optimistic forecasts of experts, Magnit retail chain will not regain its market leadership. Moreover, analysts do not rule out that Sergey Galitsky's business is ever to bankruptcy.

Those familiar with the situation say that Magnit's failures are not surprising given that competitors of Galitsky invest in a highly competent management and improve the quality of products, as opposed to the owner of Magnit. Sergey Galitsky prefers to keep control of the company in his own hands. Maybe that's why the products purchased in Magnit stores (and, in fact, made in the workshops of the Galitsky's companies) sometimes lead children to salmonellosis.

How does the businessman spend money?

Since 2008, businessman has owned the FC Krasnodar. By the way, special attention to this same club was seen from the former governor of Kuban, and now the head of the Ministry of Agriculture, Alexander Tkachev. As they say, on the basis of love for football and Krasnodar club there emerged "useful and interesting" friendship. But Rosselkhoznadzor, which from time to time penalizes Magnit, is in direct subordination of Mr. Tkachev. In particular, last year the agency fined the parent company of the retail chain, JSC Tander, for 100 thousand rubles. Rosselkhoznadzor checks revealed gross violations of legislation in the field of veterinary and technical regulations in the activities of Magnit. 

In particular, in Magnit's shops in Tula, Rosselkhoznadzor found that meat products were stored at a temperature of about 12 degrees. Given that the norm is no more than 6 degrees, what kind of fresh food replenished refrigerators of Magnit's customers and Galitsky's welfare? In addition, the inspectors had serious questions to disinfection. Although the buyers say that dirt in Magnit shops is usual business. Judging by the critical reviews of buyers, the Russian budget could have received a real boost, had Rosselkhoznadzor come to the retail chain stores more often. Or are the checks so rare due to the "footbal friendship" between Tkachev and Galitsky?

Pension "slavery"

Eight years ago, Sergei Galitsky announced his intention to acquire the Moscow non-government "Christian Pension Fund Dobrodetel". However, do not think that by buying it the businessman wanted to increase the social security of his employees. After all, knowing persons expressed confidence that the businessman would not be able to attract more than 20 thousand people to the fund. Which makes the profitability doubtful. Why then buy illiquid assets? Perhaps, in order to engage Magnit's workers in the so-called pension slavery. They cannot quit their job despite poor working conditions, and widespread discontent is very easy to suppress using such tools. In addition, today there are numerous cases when the owners of pension funds do monkey business with the money of future pensioners.

And how Mr. Galitsky treats his employees, can be exemplified by a story from 2012. Back then, the Engels regional department of the Investigative Committee initiated a criminal case against a local distribution center of Tander. Law enforcers tried to ensure the company's accountability for "discrimination based on citizen membership in voluntary associations."

The case was initiated after the Investigation Committee was addressed by Dmitry Bystrov and Sergey Kitayev, leaders of the trade union committee. Tander first demanded its employees shut the union down. And then, in violation of labor law, dismissed both the chief of the organization, and his deputy. The investigation of the case was extended several times, but then "fell apart." The criminal case does not usually fall apart, so evil tongues say that the episode might have been a separate article of expenditure of Mr. Galitsky.

"Humanity" of Galitsky

In 2015, Magnit stores found their terrible "brand", which actually cost a human life. In Kronstadt (St. Petersburg), Magnit officials arrested a 81-year-old Leningrad siege survivor, Rauza Galimova: the old woman was suspected of stealing a pack of butter. The store manager handed the pensioner over to the police.  The managers were not willing to listen any explanations. At the police station the old lady died of acute heart failure. Medics arrived too late to save her. Later revised records from surveillance cameras showed that the pensioner had no intention of stealing anything: she simply did not notice a pack of butter under the bag. The reaction of Mr. Galitsky stunned the public no less than the tragedy itself. The businessman advised the media not to f*** around.

What, do you think, was the punishment of the store director, Olga Konyukhova, for that death? None. And, darkest irony, she was pardoned because of the 70th anniversary of victory over the Nazi Germany. A month after the tragedy, the workers of a Magnit store in Barnaul made their move: they forcibly kept 12-year-old schoolgirls, suspecting them of stealing chocolate. In December 2015, a cashier of Magnit, a pregnant woman died at her working place. On condition of anonymity, her colleagues said that she felt ill, complained of fainting. But she was not allowed to leave her workplace. Otherwise, who would work to enlarge Galitsky's car collection?

Expensive and out of tune

But here's a fact: out of 57 appeals that arrived at the prosecutor's office of the Oryol region, 30 were complaints of excessive Magnet prices. In 2016 the monitoring of prices for products was conducted by Sochi authorities. And Magnit again made into the list of companies that sold goods at a price higher than the average maximum. Many do not mind to pay for the goods in exchange for a guarantee of quality. But it's useless to go to Galitsky's shops with that aim. If you don't mind the already mentioned salmonellosis, that is. For example, in 2013 Magnit was fined for the sale of food products that had expired.

In addition, Mr. Galitsky received profits from forgery and trafficking. In particular, in the Arkhangelsk region Rospotrebnadzor found that the retail chain sold vegetable-creamy spread under the guise of butter. Sergey Galitsky should be familiar with the risks of driving. But has the businessman ever ventured to eat products that are sold in his own shops?

Magnitsky disposes of shares

Early last year, Sergey Galitsky announced that he would sell 1-1.5% of the shares of the company. Moreover, the year before the businessman had already sold to investors 1% of shares of Magnit.
A year ago, the merchant directly owned 38.7% of shares of Magnit and took 15th place in the Forbes ranking with a fortune of $8.3 billion. Now, experts say to expect the further sale of Galitsky's assets. Everything still seems to be all right, the shop empire is only beginning to show signs of impending "death". And such assets are usually bought by the ones who go to quite different stores and have never seen the situation in Magnit.