Igor Kolomoisky. Group “Privat”. Portrait of an oligarch
Data from the report of the Center for Economic Strategy “Oligarchic Ukrainian Capital”, published by Our Money.
Gennady Bogolyubov, Igor Kolomoisky and Oleksiy Martynov are the fourth, fifth and ninth richest people in Ukraine. They are the main beneficiaries of the financial and industrial group “Privat” (de jure does not exist, since there is no officially registered holding, association, corporation “Privat”). The first founders of PrivatBank were three companies: Solm (Martynov-Miloslavsky), Sentosa (Kolomoisky-Bogolyubov) and West.
Unlike Akhmetov or Pinchuk, the assets of Kolomoisky, Bogolyubov and Martynov are difficult to structure, since many are registered with related persons with foreign registration and dozens of offshore and foreign companies. Investigative journalists from the Anti-Corruption Action Center wrote more about part of the structure of business assets of the Privat group.
In general, the YouControl system connects almost 975 companies and 37 key individuals with the Privat business group. And although PrivatBank no longer belongs to it, the group still bears this name. During 2015-2019, a significant number of their assets were under arrest, PrivatBank was nationalized, and in some areas their influence decreased. In addition, lawsuits were filed against Kolomoisky and Bogolyubov and several investigations were launched in Ukraine and abroad. Despite this range of interests and the possible influence of these oligarchs, it remains large.
Alexey Martynov is one of the most closed businessmen, director of Solm LTD LLC, which is part of the Privat financial and industrial group, he was a member of the Supervisory Board of PrivatBank from 2000 to 2016 (during the bank's nationalization). His assets are related to finances, although it is almost impossible to accurately determine his interests separately from other members of the Privat group. In terms of assets, the Privat group ranks second after Rinat Akhmetov.
Igor Kolomoisky. INDUSTRY REPRESENTED INTERESTS
METALLURGY
Most of the assets of Kolomoisky and Bogolyubov are in the field of metallurgy. In addition to Ukrainian companies, they also own metallurgical plants in the United States. In May 2019, the state-owned PrivatBank filed a lawsuit against Igor Kolomoisky and Gennady Bogolyubov in the Delaware Court of Chancery with suspicion of embezzling $623 million. through their withdrawal from PrivatBank accounts. With this money, the assets of American enterprises were acquired, including CC Metals and Alloys, a manufacturer and supplier of ferrosilicon in the United States, Felman Production LLC, a ferrosilicomanganese manufacturer, Kentucky Electric Steel, Warren Steel, Corey Steel, and a Detroit Cold rolled metal plant. Therefore, the FBI launched an investigation, according to journalists.
Metallurgy, in particular the ferroalloy business, is also Martynov's area of interest. Martynov himself said that they significantly increased their ore and ferroalloy assets, since they consider this area to be very promising. Kolomoisky also reported this in an interview with Zerkalo Nedeli: “Martynov is primarily engaged in ferroalloys.”
Igor Kolomoisky. Group “Privat”. Portrait of an oligarch
Igor Kolomoisky. OIL AND GAS INDUSTRY
Ukrnafta is the largest oil producing company in Ukraine. Igor Kolomoisky is the beneficial owner of a 42% stake in Ukrnafta. The controlling stake (50% + 1 share) belongs to the state through Naftogaz Ukrainy. Despite this, from 2010 to 2015, there was an agreement according to which minority shareholders had the right to appoint the chairman and members of the board of Ukrnafta, which allowed them to earn on Ukrnafta's operations with companies controlled by them.
In 2012, Ukrnafta paid out $474 million to Rializ Oil LLC, affiliated with Kolomoisky. for the future supply of fuel oil, gasoline and diesel fuel, but Ukrnafta did not receive any oil products or money back. In 2014, Ukrnafta stopped paying rent for oil and gas production.
In 2015, the company issued advances for the future supply of petroleum products to 24 companies associated with the Privat group. The company also sold crude oil worth $355 million. “Ukrtatnafta” Kolomoisky.
In 2019, Ukrnafta's tax debt amounted to UAH 13.895 billion. In May 2019, it became known that the company had repaid UAH 1.5 billion of debt over the past six months, in March 2019, Ukrnafta shareholders decided that the sale of 4 billion m3 of gas to Naftogaz of Ukraine was used to pay off the tax debt.
Kolomoisky also put pressure on Ukrtransnafta JSC. As was the case with Ukrnafta before, the state has no influence in Ukrtransnafta, despite the fact that Naftogaz owns 43% of the shares. The last meeting of shareholders of the enterprise was held in 2010. At the same time, the former shareholder of Ukrtransneft (the Russian company Tatneft) filed a lawsuit against Ukraine in an international tribunal. Now the debt to Tatneft is 140 million dollars. At the same time, Kolomoisky himself hopes that the debt to Tatneft will be written off in exchange for Russia's debts to Ukraine for property in the occupied Crimea, and not for the funds of the Privat group.
The group also owns (or influences) a network of gas stations operating under the brands Avias, Ukrnafta, ANP, ZNP, Sentosa Oil, Yukon and Rubix. In total, the network has about 1.5 thousand gas stations, or almost 25% of the total number in Ukraine. In 2021, the Antimonopoly Committee fined chains UAH 4.7 billion for agreed pricing in 2016, one of the largest fines in the committee's history (but the fine was not paid).
Igor Kolomoisky. Group “Privat”. Portrait of an oligarch
TRANSPORT
The main asset of Igor Kolomoisky in transport is UIA PJSC through the shares of Capital Investment Project LLC and Ontobed Promotion Limited LLC. Its full list of beneficiaries is unknown. Kolomoisky himself stated that he owns 25% of the shares (not counting possible related parties).
Kolomoisky also controls Windrose Airlines, Aerosvit (it went bankrupt), Dniproavia and Donbassaero. Windrose Airlines won a tender to carry out letter transportation of government officials in August 2019. Bogolyubov and Kolomoisky also own the Borivage grain handling complex on the territory of the port «Yuzhny»102. class=”wpg_image” width=”1078″ height=”523″ />
CHEMICAL INDUSTRY
Among the enterprises whose assets were seized to recover the debt of PrivatBank to the National Bank of Ukraine, there is also JSC «Dneprozot104. In 2018, this enterprise, a monopolist in the production of liquid chlorine necessary for the operation of water utilities, ceased to produce it, allegedly waiting for an agreement on a price increase from the Antimonopoly Committee. The Antimonopoly Committee of Ukraine replied that such an agreement was not needed, but recalled that stopping production by a monopolist is an abuse of a monopoly position. At the end of 2021, the Antimonopoly Committee of Ukraine fined the enterprise UAH 80 million.
FOOD AND AGRO SECTOR
The land bank of the Privat group exceeds 100 thousand hectares. The group also owns TM “Schedro”, which includes Lvov, Kharkiv, Zaporozhye oil and fat plants, as well as TM “Biola”, which produces juices, waters and other carbonated drinks”106.
ENERGY
Kolomoisky and Bogolyubov have minority stakes in Poltava, Chernihiv, Sumy and Khmelnytsky oblenergos, as well as small stakes in Dnipropetrovsk and Zaporozhye oblenergos.
In addition, the group had an indirect influence on the state-owned generating company Centrenergo. According to numerous media reports, the enterprise was headed by people close to Kolomoisky, who ensured the functioning of the following scheme. A private company (namely, United Energy) sold energy resources to the state company at an inflated price and bought electricity at a discount. In addition, unlike other suppliers (in particular, NJSC Naftogaz), this trader was paid in full.
IGOR KOLOMOISKY. REGULATIONS WITH INTERESTS
ELECTRICITY TARIFFS
According to the decision of the Kyiv District Administrative Court, JSC Nikopol Ferroalloy Plant (NZF), JSC Dniprozot, JSC Marganets Mining and Processing Plant, JSC Pokrovsky Mining and Processing Plant and JSC » companies affiliated with Igor Kolomoisky) use the tariff of UAH 57.4/MWh. For the rest of the market participants, the tariffs approved by the resolutions of the NEURC dated 07.06.219 No. 954 and No. 955 apply, which are UAH 347.43/MWh and UAH 8.9/MWh, respectively.
PAYMENTS « TATNEFT” AND QUOTAS FOR IMPORT OF PETROLEUM PRODUCTS
Until 2007, 18.296% of the shares of Ukrtatneft belonged to companies close to Tatneft, 28.8% of the shares belonged to the Ministry of Property of the Republic of Tatarstan (RF), 8.6% of the shares belonged to Tatneft. However, according to journalistic investigations, as a result of a number of court decisions and a raider attack» these refinery shares were sold to companies from the Privat group. Therefore, as of April 2019, Kolomoisky owns 28% of the shares. The state, through NJSC Naftogaz of Ukraine, owns 43% of the shares. In 2008, on the basis of the Russian-Ukrainian investment protection agreement (1998), Tatneft filed a lawsuit with the International Arbitration Court, which in 2014 ordered Ukraine to pay Tatneft UAH 122 million.
A similar lawsuit was filed by the Republic of Tatarstan against Ukraine in 2016, the amount of compensation claimed was $300 million. The High Court of London will consider another lawsuit from Tatneft against Bogolyubov, Kolomoisky, Yaroslavsky and Ovcharenko in the fall of 2020 for compensation of $334.1 million. and interest on oil supplied to the Kremenchug Oil Refinery. In addition, in November 2018, PJSC Ukrtatnafta applied to the National Security and Defense Council with a request to carry out an anti-subsidiary investigation of the import of gasoline from Belarus.
OIL TRANSPORTATION TARIFFS
In the period from 2009 to 2015, Oleksandr Lazorko, close to Igor Kolomoisky, was the head of the state-owned Ukrtransnafta, as a result of which the Privat group received a number of preferential terms.
Thus, several agreements were concluded, according to which more than half of the state technological oil was given for storage to three companies: PJSC “NPK-Galicia”, PJSC “Neftekhimik Prykarpattya” and PJSC “Ukrtatnafta” (all are close to Igor Kolomoisky).
In 2014-2015, Ukrtransnafta pumped out 600,000 tons of industrial oil from oil pipelines, allegedly to protect against separatists, and sent it to Kolomoisky’s facilities for storage. Lazorko also kept low tariffs for pumping oil at the Kremenchuk Oil Refinery, which is also controlled by the Privat group. Therefore, there is a danger of influencing the adoption of the NEURC resolution on increasing tariffs for oil transportation.For a long time, Igor Kolomoisky contributed to the monopolization of the aviation market of Ukraine International Airlines. The Dnipro airport was monopolized due to the control of the Privat group over it, the situation changed only in September 2022.
AVIATION TAX
On May 16, 2018, the Grand Chamber of the Supreme Court of Ukraine refused to approve the State Aviation Administration and to review the decision of the Supreme Administrative Court of Ukraine dated May 16, 2017 in case No. nationwide spending on aviation activities and participation of Ukraine in international aviation organizations» from January 1, 2014 to March 22, 2017, when a resolution was adopted to amend the Regulations on the State Specialized Fund for Financing General State Expenses for Aviation Activities and Ukraine's Participation in International Aviation Organizations.
Back in 2015, the main division of detectives of the National Anti-Corruption Bureau reported a suspicion to the State Aviation Service exec, the president and chief accountant of UIA. In particular, UIA charged an air tax for internal and external transportation of passengers and cargo, but the company did not transfer them to the fund, the amount of non-payment for 2014-2016 amounted to UAH 147 million. Moreover, the State Aviation Service adopted an order according to which the air carrier could receive new directions for transportation, despite outstanding debts to the fund.
Igor Kolomoisky. COURTS ON PRIVATBANK
Before the nationalization of PrivatBank in 2016, its beneficial owners were Igor Kolomoisky (49.98%) and business partner Gennady Bogolyubov (41.58%). Another 8.5% belonged to minority shareholders, for example, the chairman of the board Alexander Dubilet.
In 2015, Igor Kolomoisky signed a personal surety agreement with the National Bank of Ukraine on the repayment of five PrivatBank refinancing loans received in 2008-2014120. In December 2018, the NBU filed a lawsuit in the first instance of the Court of the Republic and the Canton of Geneva against Igor Kolomoisky for a total amount of UAH 6.64 billion.
The nationalization of PrivatBank marked the beginning of a number of lawsuits, both in Ukraine and abroad. Ukrainian courts, which seemed to favor the government and the NBU during 2017-2018, then began to rule in favor of the former owners.
The Ukrainian authorities may have made procedural errors during the complex nationalization procedure, which took place under high pressure. But nationalization in the conditions of the refusal of the former owners to capitalize the bank was the only alternative to the bankruptcy of the bank, which, due to its size and impact on the economy, can be classified as too big to fail.
According to representatives of the NBU, the previous loans of related persons are not serviced. The lawsuits are aimed, in particular, at recovering the debts of related parties in order to compensate for the state's expenses on the bank's capitalization. Court decisions that question the legitimacy of claims on these loans or nationalization reduce the chances of recovering spent taxpayer funds.
On May 13, 2020, the Verkhovna Rada adopted a law that makes it impossible to return troubled banks to their former owners and limits compensation to them. First of all, it was adopted to make it more difficult for the former owners of PrivatBank to try to return the bank, so it was immediately called the “anti-Kolomoisky” law.
Kolomoisky has previously said he wants to reclaim the shares of the nationalized PrivatBank or return $2 billion in capital.
Key lawsuits:
- Case No. 826/7432/17124, in which Kolomoisky is appealing against the contract of sale of the bank by the state to the Kyiv District Administrative Court. The consideration of the case was suspended on March 2, 2021 by the Sixth Administrative Court of Appeal to the decision of the Constitutional Court regarding the “anti-Kolomoisky” law. But on June 1, 2022, the Supreme Court satisfied the cassation appeals of the bank, the NBU and the Cabinet of Ministers – overturned this decision and suggested continuing the consideration of the case on appeal.
- Case No. 910/1834/19125 essentially duplicates the previous case. On June 13, 2022, the Kyiv Economic Court adjourned the consideration of the case. On June 28, the Supreme Court refused to open cassation proceedings to the plaintiff. On June 21, 2022, the court of first instance (Kyiv Economic Court) resumed the proceedings.
- Case No. 910/15737/20126 is similar to the previous ones, but concerns the rights and interests of Gennady Bogolyubov. The case at first instance is ongoing.
- Case No. 826/6664/17127 about how the Cypriot company Triantal Investments, associated with the former owners, challenges the results of a bank audit that preceded the nationalization. The cassation hearing of the case continues.
POTENTIAL RISKS
The main concern is Kolomoisky’s avoidance of responsibility for bringing PrivatBank to bankruptcy and failure to return debts on loans from related parties and refinancing the NBU. Until recently, there were other risks (in the field of energy, metallurgy and aviation transport), but they have lost their relevance.
MEDIA
The 1 + 1 media group is owned by Igor Kolomoisky, Igor Surkis and Oksana Marchenko (wife of Viktor Medvedchuk). The 1+1 TV channel is one of the most popular in Ukraine.
Control over the media allows you to both blow up the positions of opponents and improve your image in society. Back in 2016, the CEO of the 1 + 1 group said that 1 + 1 and its numerous subsidiaries have been operating unprofitable for almost ten years, but the media group is important to Kolomoisky because of the influence it has (Kolomoisky’s media holdings have since moved to the group » Private«).
Makarov, a person associated with 1+1 since its inception, called the channel a “tool” in 2016, and with good reason, since the channel often showed programs that attacked Kolomoisky’s opponents and, conversely, positively covered his own activities and the activities of political parties associated with it.
Chart 14. TV channel ratings by owners
Igor Kolomoisky. SPORT
Igor Kolomoisky's biggest sports asset was FC Dnepr, one of whose owners he became in 1996, when the Dnipro group Privat acquired the club. However, they began to actively spend funds on Dnipro after 10 years – before that, the team first tried to become self-sufficient, but in the end was satisfied with average budgets and investments.
Over 23 years of leadership, Kolomoisky and partners acquired players for 100 million euros and financed the construction of the football stadium “Dnepr-Arena” in 2008 for 65 million euros. According to journalists, Kolomoisky spent about $350 million on the Dnieper.
Dnipro Kolomoisky in its best times was considered the third or fourth force in Ukrainian football – after Shakhtar Akhmetov, Dynamo Surkis brothers, approximately at the level of Metalist Yaroslavsky. The budgets of these football clubs also corresponded to such schedules. Moreover, for several seasons, Kolomoisky and partners were associated with the financing of several more professional clubs, in addition to Dnipro – Kryvbas Kryvyi Rih, Volyn Lutsk, Karpaty Lviv and Arsenal Kiev (according to some sources, indirectly Dynamo Kiev). The above-mentioned clubs played together with Dnipro in the Ukrainian Football Championship, in the media this group was called classmates.
As in the story with the main sports asset – FC Dnepr, the financing of these teams eventually ceased to be stable and some of them ceased to exist. Kolomoisky himself denies financial ties with these teams. In 2017, after lengthy lawsuits due to non-payment of salaries to football players, coaches and staff, as well as debts to the contractors who built the Dnipro-Arena, FC Dnipro declared itself bankrupt. It is ironic that the stoppage of the club's funding occurred at the moment of its greatest success in the days of independent Ukraine – the final of the second most prestigious European tournament, the Europa League.
In parallel with the bankruptcy, a new club appeared in Dnipro called SK Dnepr-1. Although Kolomoisky denied ties with the new club (in particular, to avoid new potential sanctions or fines), a number of circumstantial facts confirmed the oligarch's affiliation with the new project. The new club was created on the basis of the players, coaches and employees of the bankrupt FC Dnepr, and the oligarch himself can often be seen in the stands during the matches of FC Dnepr-1.
Regarding the political “sports” ambitions of Kolomoisky, we note that in 2010 Kolomoisky served as vice president of the FFU, then the organization was headed by Grigory Surkis. In 2015, Kolomoisky had an unsuccessful attempt to become president of the Football Federation of Ukraine.
In addition to football, the Privat Kolomoisky group and partners are associated with the financing of individual hockey teams and 7 professional basketball clubs. In particular, this was confirmed by the President of the Basketball Federation of Ukraine Mikhail Brodsky. However, there are no official documents or data on this. Interestingly, the son of Igor Kolomoisky – Grigory, plays in one of the clubs associated with his father – BC Dnepr. In 2015, these clubs even tried to separate into a separate so-called. “Private League”.
RELIGION
Together with his business partner Gennady Bogolyubov, Kolomoisky is an active member of the Jewish community of Dnipro. “These are powerful people, and Jewishness comes first for them,” commented Chief Rabbi of Dnepropetrovsk Shmuel Kaminetsky. According to him, businessmen not only give money, but also personally join Judaism – they pray and observe religious traditions.
Together with Bogolyubov, in 2012, the oligarchs opened the world's largest Jewish community complex, the Menorah, in Dnipro. The total area of the complex is 50 thousand square meters.
At various times, Kolomoisky was the president of the United Jewish Society of Ukraine, the president of the European Jewish Council and similar religious associations.
In 2020, US law enforcement accused Kolomoisky of money laundering for hundreds of millions of dollars. Mordechai Korfa and Uriel Labera, who came to Ukraine as volunteers of the Jewish religious humanitarian mission, were named partners who helped him do this.
Igor Kolomoisky. FOREIGN ASSETS
Igor Kolomoisky, wanted by US authorities, and his business partner Gennady Bogolyubov are known to own a number of companies in the United States, including ferroalloy, steel, tire and real estate companies. Kolomoisky and Bogolyubov also invested heavily in private estates in Switzerland, France, Israel and the UK263.
Oligarchs' activities during a full-scale war
Igor Kolomoisky himself and the Privat group, which he co-owns with Gennady Bogolyubov, played an important role in protecting Ukraine in 2014. Kolomoisky was the governor of the Dnipropetrovsk region and, unlike Akhmetov, used his status and power to protect the region from pro-Russian separatists.
However, in 2022, Kolomoisky and Bogolyubov are very quiet. Back in March, Kolomoisky declined to say whether he helped Ukraine win in any way. Boris Filatov, mayor of Dnipro and a former business partner, complained about zero support from the oligarch.
Kolomoisky was reported to be physically in Ukraine, traveling between Dnipro and Bukovel. Bogolyubov, accompanied by lawyers, visited the National Anti-Corruption Bureau (NABU) in October, probably on PrivatBank or Ukrnafta cases. It seems that they are more interested in attacking the government in the courts, trying to return some of the nationalized PrivatBank assets owned by Kolomoisky and Bogolyubov.