Crisis costs them billions
Judging by everything, Suleiman Kerimov, a major Russian investor, is having problems meeting his financial obligations. According to Handelsblatt, Mr Kerimov was unable to pay a margin call the other day, while the impression until recently was that his GNK company was lucky and that he would not go the way of some other Russian billionaires hit by the crisis. Tidal waves coming from Wall Street can shake up the Russian oligarchs well and truly, but the ultimate winner is likely to be only the state.
Mr Kerimov, whose fortune according to the Forbes list was estimated at $17 billion, made his money by trading shares, using Sberbank loans to buy up stakes in Gazprom and Sberbank itself. He is said to have sold these shares in June for $15 billion. Later, however, according to the same rumours, Mr Kerimov spent most of his money purchasing stakes in Fortis and Deutsche Bank. No matter where Mr Kerimov invested his billions, however, he miscalculated badly and is now having problems serving the loans collaterised by his shares.
He is not alone in his problems: the aluminium king, Oleg Deripaska, can only hope for state aid to keep his 25% stake in the mining and metallurgical company Norilsk Nickel. Mikhail Fridman, notorious for his controversial role in the power struggle in the TNK-BP company, also seems to need state help. A similar situation is facing Vladimir Yevtushenko, who heads an empire of mobile communications, real estate and retail. However, none of the tycoons wants to acknowledge their problems.
You are not likely to see luxury Maybach cars with "for sale" signs on Moscow streets yet, but the Russian oligarchs, after their shares have fallen by more than 70%, have suffered great losses: according to the estimates of the Bloomberg agency, the combined fortunes of the 25 richest Russians have shrunk by $230 billion.
According to market experts in Moscow, the country's industrial elite are feverishly looking for cash to serve their loans. Even property sales are used for these purposes, said one of the insiders: "Those wishing to buy a Ferrari, a yacht or a villa can do so at bargain prices."
Olga Kryshtanovskaya, an expert on elites, knows for sure who will benefit from the crisis: "Billionaires' problems increase the role of the state, because nearly all natural resources are concentrated in its hands." In the opinion of Ms Kryshtanovskaya, a similar situation is typical of the West, "but in Russia the state pursues its economic interests with greater vigour."
She is echoed by Christopher Weafer, chief strategist at Uralsib Bank, who says that by making financial injections, the Kremlin increases its influence in major companies and industries in the country. The state will dictate to them how they should invest and develop, Mr Weafer said. About $50 billion will be enough to prevent the bankruptcy of companies that have run aground.
Money to crisis-hit firms will come via state-owned Vnesheconombank (VEB), whose head Vladimir Dmitriyev, in a Handelsblatt interview, said his bank was ready to buy whole enterprises if necessary. The head of its supervisory board is Prime Minister Vladimir Putin.
Ms Kryshtanovskaya predicts that, under cover of the crisis, Russia will undertake another "redistribution" [of property]. In her opinion, the country's political leadership had its finger in the economic pie before, while now it has much wider opportunities. And although at the start of his presidency Mr Putin concluded a sort of pact with the oligarchs, the Kremlin still complains that some or other billionaire "occasionally puts on airs". Now the crisis is providing the authorities with leverage to bring unsympathetic businessmen "down a peg or two".
Nikolai Petrov of the Moscow Carnegie Centre believes that the group of "Kremlin oligarchs" will nonetheless come out on top. They are people like Sergei Chemezov, a friend of Vladimir Putin. He is the head of the Russian Technology state corporation that controls an empire consisting of 500 companies. "They are so close to the country's leadership that getting money is no problem for them," Mr Petrov said. Methods of absorbing troublesome rivals are also well known to them.
In cooperation with Handelsblatt
