Viktor Vekselberg

Viktor Vekselberg
Viktor Felixovich Vekselberg (born April 14, 1957) is a Ukrainian-born Russian-Israeli-Cypriot oligarch, billionaire, and businessman. He is the owner and president of Renova Group, a Russian conglomerate. According to Forbes, as of November 2021, his fortune is estimated at $9.3 billion, making him the 262nd richest person in the world.
Vekselberg is close to the Kremlin. In April 2018, the United States imposed sanctions on him and 23 other Russian nationals in relation to Russia's annexation of Crimea, officially freezing up to $2 billion in assets.
Early life, family and education
Viktor Vekselberg was born in 1957 to a Ukrainian Jewish father and a Russian mother in Drohobych, Ukrainian Soviet Socialist Republic (although some reports state that he was born in Lviv). All of Vekselberg’s family of seventeen fell victims to the Holocaust. They were murdered and buried in a mass grave during the Nazi repressions in Drohobych, Western Ukraine. Only Vekselberg’s father and his cousin survived the massacre. Vekselberg’s father had gone off to war, while his neighbors hid his cousin in a pit-house for almost four years. At the end of the war, she managed to flee to the territory that was controlled by the U.S. troops and later she moved to the U.S. Andrew Intrater is Vekselbergs cousin.
In 1979, he graduated from the Moscow State University of Railway Engineering. After that, he worked as a researcher and headed the laboratory of the Design Bureau for rodless pumps "Konnas".
Career
In 1988, after the Gorbachev administration relaxed restrictions on private business as part of its new policy Perestroika and Glasnost, Vekselberg founded company Komvek, and in 1990, he co-founded Renova Group with college classmates, Leonard Blavatnik and Vladimir Balaeskoul (later, they both sold their stakes in Renova to Vekselberg). In the mid-1990s, Vekselberg and Blavatnik embarked on accumulating interests in aluminium smelters. The two partners recommissioned production at Irkutsk Aluminium Plant which had been previously suspended. In 1996, they co-founded Siberian-Urals Aluminium Company (SUAL) by merging of Ural and Irkutsk Aluminium Plants into Russia’s first aluminium holding company. (SUAL would later merge with Russian Aluminium of Oleg Deripaska and alumina assets of Glencore to create United Company RUSAL, the world’s largest aluminium company). In 2002, SUAL constructed the first private railway in Russia to connect a bauxite mine in the Komi Republic with Ural Aluminium Plant through Trans-Siberian Railroad.
SUAL was the first major Russian company to pursue a consistent social policy in regions, offering support to local communities and small entrepreneurs. As from 2001, SUAL initiated several social and economic partnerships between its aluminium smelters and local municipalities in the regions of their presence. Moreover, SUAL set up a lifetime pension plan for World War II veterans who used to work at the plants that became part of SUAL.
In 1997, Alfa Group (owned by Mikhail Fridman, German Khan, and Alexei Kuzmichev) created with Vekselberg and Blavatnik a partnership for the acquisition of an interest in Tyumen Oil Company (TNK) that later became one of Russia's largest oil and gas companies. In order to jointly hold oil assets, Alfa Group, Access Industries (a company owned by Blavatnik) and Vekselberg’s Renova established AAR consortium.
In 2003, AAR and British Petroleum (a British-American company then) merged their Russian oil assets in a 50-50 joint venture named TNK-BP, and that was the largest private transaction in Russian history. Acting as the chairman of the executive board of TNK, Vekselberg was instrumental in negotiating and closing the transaction. Vekselberg’s indirect participation in TNK-BP amounted to 12.5%.
In the 2000’s, TNK-BP was the third oil & gas company in Russia. Among other things, TNK-BP considered construction of a gas pipeline from the Kovykta gas condensate field through Mongolia to China and South Korea. Also, the original plan also envisaged the possibility to build up a large helium production facility on the basis of Sayanskkhimplast plant to export helium to Asia-Pacific markets. In the middle of 2012, BP started talks with the state oil company Rosneft with a view to selling BP’s 50% stake in TNK-BP. Rosneft finalised preliminary approval of a comprehensive deal in early 2013, offering to buy out TNK-BP in its entirety - AAR received cash consideration for its stake, BP received cash and Rosneft shares.
In 2006, Renova Group decided to diversify its business and divest form oil and gas sector to expand its footprint in manufacturing, hi-tech, and renewable energy. In 2007, Standard & Poor's assigned a 'BB' long-term corporate credit rating to Renova Holding Ltd. and that spoke for the Group’s significant progress in portfolio diversification and liquidity improvement. After divesting from the oil & gas sector, Vekselberg focused on the renewable energy, transport infrastructure, manufacturing, and IoT. Vekselberg became a pioneer in the Russian solar power sector. Founded by Renova in 2009, Hevel was the first company in Russia to build a full-cycle plant for the production of solar modules in 2015 and the first industrial-scale solar power plant in 2017. In 2017, Vekselberg inaugurated Platov International Airport in Rostov-on-Don, the first greenfield airport built in Russia after the collapse of the USSR. In 2019, Gagarin International Airport, the second greenfield airport, was put in operation in Saratov.
In 2004, Renova Group opened a branch in Zurich, Renova Management AG, as a part of the strategic plan to diversify its business towards hi-tech.
In July 2006, Renova Group acquired 10.25% in Unaxis Holding AG (later renamed as OC Oerlikon) from Victory Industriebeteiligung AG, an Austrian conglomerate.
In April 2007, Everest Beteiligungs GmbH, a joint venture of Renova Group and Victory, acquired approximately 18% in shares and additional 14% in physical delivery options in Sulzer.
Later, in 2007 – 2008, Victory sold out their stakes in both companies. In 2009, Renova Group raised its stake in Oerlikon to 44.7%.
This accumulation of stakes in the two flagships of the Swiss economy by the foreign conglomerate raised concerns with the Swiss authorities. Nevertheless, in 2010 the Federal Criminal Court confirmed that neither Vekselberg, nor Victory done any wrongdoing while building stakes in Oerlikon. Later, the Federal Department of Finance dropped the criminal proceedings initiated against the three investors in Sulzer in 2009.
In 2008, Vekselberg proxied a deal between Russian and Hungarian governments, buying the former embassy building from Hungary for $21m and immediately selling it to the Russian government for $116m, while the market price of the building was estimated at $50m. Investigation of the paper trail by Alexey Navalny and the Rospil project has found several invalid and backdated documents, thus suggesting a collusion (e.g. the tender held by the Hungarian side was totally fictive, as the building was already sold by that time). Hungarian officials responsible for the deal (Tátrai Miklós, Marta Horvathne Fekszi and Arpad Szekely) were detained in February 2011. On the Russian side, a criminal investigation was only started in August 2013.
In 2010, Vekselberg was appointed President of the Skolkovo Foundation, a non-profit organization funded by a mix of private investors and the Russian government, with the goal of building a technology research hub in Russia. As its president, Vekselberg signed a deal for Cisco Systems to invest $1 billion over ten years into Skolkovo Foundation projects. The Federal Bureau of Investigation subsequently issued a statement claiming that the Skolkovo Foundation was being used by the Russian government to gain access to classified American technology.
In May 2010 Vekselberg reported that he would be relocating from Zurich to the Zug canton, a region of Switzerland that still supports the lump sum tax policy which was abolished by Zurich.
In March 2017, he was offered citizenship of the Republic of Cyprus due to his investments in the country; however, a spokesperson for Vekselberg reiterated that he only had Russian citizenship.
Designation under United States sanctions programmes
Vekselberg is one of many Russian "oligarchs" named in the Countering America's Adversaries Through Sanctions Act (CAATSA) signed into law by President Donald Trump in 2017.
In March 2018, members from Robert Mueller's team of special counsel investigators questioned Vekselberg at a New York area airport.
In April 2018, the United States Department of the Treasury imposed sanctions on Vekselberg and Renova Group through designation under ("Blocking Property of Additional Persons Contributing to the Situation in Ukraine").
In February 2021, Vekselberg complained that more than $1.5 billion of his funds were frozen in American and Swiss bank accounts and that he was not allowed to send "small amounts" to charity.
On September 1, 2022, several properties believed to be linked to Vekselberg were searched by the FBI and Department of Homeland Security. The inspection included an apartment in Manhattan; an estate in the Hamptons, New York; and property on Fisher Island in Florida. Officials were seen carrying boxes out of the two New York locations.
In March 2022, following Russia's invasion against Ukraine, the United States strengthened its sanctions and the UK, Poland and Australia also placed sanctions on Vekselberg, thereby seizing his assets and imposing a travel ban. During the Lady R incident Vekselberg was noted in the media as a possible source of Russian foreign influence over the South Africa's governing party, the African National Congress (ANC), through his 49% ownership stake in United Manganese of Kalahari which is a joint venture with the ANC owned Chancellor House. United Manganese of Kalahari made a US$1.3 million donation to the party in 2022.
Seizure of the Motoryacht Tango
Following the 2022 Russian invasion of Ukraine, United States President Joseph R. Biden signed , "Prohibiting Certain Imports, Exports, and New Investment With Respect to Continued Russian Federation Aggression," an order of economic sanctions under the United States International Emergency Economic Powers Act. The order targeted two properties of Vekselberg worth an estimated $180 million: an Airbus A319-115 jet and the motoryacht Tango. Estimates of the value of the Tango range from $90 million (U.S. Department of Justice estimate) to $120 million (from the website Superyachtfan.com).
In April 2022, the yacht was seized by Civil Guard of Spain and U.S. federal agents in Mallorca. A United States Department of Justice press release states that the seizure of the Tango was by request of Task Force KleptoCapture, an interagency task force operated through the United States Deputy Attorney General.
The matter is pending in the United States District Court for the District of Columbia. The affidavit for the seizure warrant states that the yacht is seized on probable cause to suspect violations of (conspiracy to commit bank fraud), (International Emergency Economic Powers Act), and (money laundering), and as authorized by American statutes on civil and criminal asset forfeiture.
Art collection
In February 2004, Vekselberg purchased nine Fabergé Imperial Easter eggs from the Forbes publishing family in New York City. The collection was transported to Russia and exhibited in the Kremlin and in Dubrovnik in 2007. Vekselberg is the single largest owner of Fabergé eggs in the world, owning fifteen of them (nine Imperial, two Kelch, and four other Fabergé eggs). In a 2013 BBC Four documentary, Vekselberg revealed that he had spent just over $100 million purchasing the nine Fabergé Imperial eggs from the Forbes collection. He claims never to have displayed them in his home, saying he bought them because they are important to Russian history and culture, and he believed them to be the best jewelry art in the world. In the same BBC documentary, Vekselberg revealed plans to open a museum to display the eggs in his collection. The result was the Fabergé Museum in Saint Petersburg, Russia, which had its official opening ceremony on November 19, 2013.
In September 2006, Vekselberg agreed to pay approximately $1 million in expenses to transport the Lowell House Bells from Harvard University in the United States back to their original location in the Danilov Monastery and to purchase replacement bells. The historic bells returned to Moscow on September 12, 2008, with the assistance of the U.S. director of the organization, Edward Mermelstein.
Vekselberg paid £1.7 million at a Christie's auction in 2005 for Odalisque, a nude said to be the work of Russian artist Boris Kustodiev. However, soon after the purchase, experts working for Vekselberg's art fund, Aurora, began to cast doubt on the picture's authenticity. They claimed that Kustodiev's signature, dated 1919, was done in aluminium-based pigment not available until after the artist's death in 1927. Vekselberg sued Christie's, and the judge ruled in July 2012 that he was entitled to recover the £1.7 million that he paid for the painting, plus Christie's was ordered to pay around £1 million in costs.
Charitable donations
Vekselberg's firm Renova donated between $50,000 and $100,000 to the Clinton Foundation.
He donated $4.5 million to the construction of the $50 million Jewish Museum and Tolerance Center in Moscow, and is the chairman of the museum's board of trustees. He finances the restoration and construction of synagogues in Russia, including the construction of the Choral Synagogue in Saratov.
In 2019, a monument was opened in Moscow to commemorate resistance heroes in concentration camps and ghettos. Vekselberg donated $300,000 to its creation.
In 2020, when the coronavirus pandemic began, Viktor Vekselberg donated 180 million rubles to buy medical equipment, personal protective equipment, and food for socially vulnerable groups of citizens.
In 2021, Russian Foreign Minister Sergey Lavrov awarded Viktor Vekselberg, among other leaders of the Russian Union of Industrialists and Entrepreneurs, for helping to bring back Russian tourists from abroad.
Personal life
He is married to Marina and has two children, a daughter and a son. His father is Jewish, and his mother Christian. He identifies himself as multi-national and does not attend weekly synagogue or church services.
Vekselberg is a longtime friend and business partner of British–American billionaire and major Republican Party donor Len Blavatnik, who is close to Israeli Prime Minister Benjamin Netanyahu.
Being placed under sanctions by President Trump's administration he names to be his personal tragedy, because he was left unable to visit his daughter and grandson in New York.
Vekselberg reportedly lives in Switzerland.
References
External links
Forbes:Viktor Vekselberg
RENOVA
Made in Russia:Viktor Vekselberg
1957 births
Living people
BP people
Ukrainian emigrants to Russia
Ukrainian Jews
Soviet Jews
Russian art collectors
Russian billionaires
Russian businesspeople in the oil industry
Russian engineers
Russian Jews
Russian individuals subject to the U.S. Department of the Treasury sanctions
Russian individuals subject to European Union sanctions
Russian individuals subject to United Kingdom sanctions
Naturalized citizens of Cyprus
Russian oligarchs
Full Cavaliers of the Order "For Merit to the Fatherland"
Articles containing video clips
Russian businesspeople in Cyprus
Russian businesspeople in Israel