Zhevago and his business. Reference
Data from report Center for Economic Strategy “Oligarchic Ukrainian Capital” reports Our money.
The youngest of the richest people in Ukraine. Has interests in metallurgy, pharmaceutical industry, transport and energy. The largest assets are Ferrexpo and Arterium. He was a deputy of the III-VIII convocations from the Batkivshchyna party and a self-nominated candidate in the majoritarian constituency. Until 2015, he owned the Finance and Credit bank, which is now in a state of liquidation.
Zhevago and his business. Help: INDUSTRIES IN WHICH INTERESTS ARE REPRESENTED
METALLURGY (FERREXPO)
Konstantin Zhevago is a shareholder and CEO of Ferrexpo. It owns a number of assets in Ukraine, in particular, the Poltava, Eristovsky and Belanovsky mining and processing plants. It also has a production license for the Galishchansky mountain deposit and an exploration license for five more mountain deposits. In addition, Ferrexpo owns its own transport and processing facilities, which means it is vertically integrated.
Ferrexpo shares are traded on the London Stock Exchange. In addition to assets in Ukraine, it has representative offices in a number of other countries, in particular in Britain, Switzerland, Japan, and China.
Zhevago and his business. Reference:
PHARMACEUTICAL AREA
The Ukrainian pharmaceutical market is characterized by a large share of imports. Among the local manufacturers, the largest are Farmak, Darnitsa, SPC Borshchagovsky Chemical Pharmaceutical Plant, Arterium, KVN and Sanofi, and the largest in terms of drug sales are Farmak (Ukraine), Arterium (Ukraine), Teva ( Israel), Darnitsa (Ukraine) and Sanofi (France).
Konstantin Zhevago owns the Arterium corporation, created in 2005. It includes the enterprises “Kievmedpreparat” and “Galichfarm”. This company is the second most profitable in Ukraine in the industry. The corporation has representative offices in many CIS countries and is export-oriented.
TRANSPORT
49.9% of the shares of TIS-RUDA LLC belong to the Poltava Mining and Processing Plant, part of the Ferrexpo group Konstantin Zhevago. “TIS-RUDA” is engaged in the transport processing of cargo, and it is they who own the terminal for transshipment of pellets. In addition, Ferrexpo has 150 barges and 2,252 wagons.
Zhevago and his business. Help: ENERGY
Konstantin Zhevago owns the Belotserkovskaya Thermal Power Plant. Journalistic investigations show that companies associated with Zhevago have repeatedly won tenders for servicing the Belotserkovskaya CHPP, in particular, converting it to burning solid coal.
MECHANICAL ENGINEERING
Konstantin Zhevago owns the company PJSC AvtoKrAZ. It also includes the Foreign Trade Company “KrAZ”, LLC “KrAZ Leasing”, Poltava Automotive Aggregate Plant, Kherson Cardan Shaft Plant, Kamenets-Podolsk Automotive Assembly Plant, Tokmak Forging and Stamping Plant, Simferopol Automobile Wheels Plant (located in the occupied territory) Autoradiator”. According to OpenDataBot, at the end of July 2019, bankruptcy proceedings were initiated at PJSC AvtoKrAZ. According to YouControl, AvtoKrAZ is unprofitable.
In addition, Zhevago belongs to the Stakhanov Carriage Works, but is located in occupied territory.
Zhevago and his business. Help: REGULATIONS WITH INHERENT INTERESTS
TARIFFS FOR RENTAL OF GOVERNMENT CARS
Renting state-owned carriages is cheaper than renting private ones. Therefore, companies that want to transport their goods prefer state-owned wagons. But the number of such cars is limited, so demand is greater than supply. The report of the Ukrainian Institute of the Future claims that this is why there are certain shadow tariffs – an additional surcharge for the transportation of goods that goes outside the cash register. According to the Ukrainian Institute of the Future, Ferrexpo is one of the main beneficiaries of this scheme.
LAWSUIT IN AMK
In 2015, the Poltava Mining and Processing Plant, owned by Konstantin Zhevago, filed a claim that the Ostchem group, owned by Dmitry Firtash, was a monopoly. The consideration of this case ended on September 3, 2019, when the Antimonopoly Committee of Ukraine admitted that Firtash had abused his monopoly position in the fertilizer market and fined him UAH 107 million. and forced the division of Ostchem in terms of nitrogen mineral fertilizers.
DEFENSE ORDER
In 2013, the AvtoKrAZ company, owned by Konstantin Zhevago, signed an agreement with the Ministry of Defense in the amount of UAH 136.5 million, which stipulated that the company would supply trucks to the Ministry of Defense. According to a study by the Independent Anti-Corruption Committee, the level of secrecy in state defense orders is 90%, while in other countries it is 10-20%. Despite the fact that Konstantin Zhevago promised in his election program to restore the defense order system, he did not vote for the corresponding law (the wrong meeting did not come).
Zhevago and his business. Help: IMPORT OF MEDICAL DRUGS
Zhevago companies that control the production of syringes initiated an anti-dumping investigation by the Interdepartmental Commission on International Trade on the import of syringes from other countries. The investigation has been going on for almost two years, since November 2017, and so far it has been useless.
PROGRAM “AFFORDABLE MEDICINES”
In 2017, the government launched the Affordable Medicines program. Under this program, Ukrainians who have cardiovascular diseases, type II diabetes and bronchial asthma and have a prescription from a doctor can receive certain medications for free or with a partial copayment. At the same time, the state reimburses only the cost of cheap drugs for each category of drugs. If the patient wants to get a more expensive drug, he can pay the difference. As of 2019, the register of drugs, the cost of which is fully reimbursed by the state, includes 14 drugs produced by the Kievmedpreparat enterprise, owned by Zhevago.
REGISTRATION OF MEDICINES
The procedure for registration (re-registration) of medicines is approved by a resolution of the Cabinet of Ministers. The current version of the resolution provides that registration is carried out by the Ministry of Health based on the results of the examination of the State Expert Center of the Ministry of Health.
Konstantin Zhevago or companies associated with him are (or have recently been) involved in several legal cases. Such cases can be conditionally divided into those related to the Finance and Credit Bank (in a state of liquidation) and those related to AvtoKrAZ (in a state of bankruptcy).
Zhevago and his business. Help: COURTS FOR THE BANK “FINANCE AND CREDIT”
As noted above, Finance and Credit Bank is now in a state of liquidation. The bank’s liquidators filed a number of lawsuits against other companies associated with Zhevago, for example Belotserkovsky CHPP, FC Vorskla. In addition, the police are investigating the case of the absence of guarantee agreements at the Finance and Credit bank where the guarantors were Poltava Mining and Processing Plant, Eristovsky Mining and Processing Plant and other companies controlled by Zhevago.
CREDIT COURTS “AVTOKRAZ”
Lawsuits between AvtoKrAZ and Sberbank have been ongoing for several years. In July 2019, the Court of Appeal rejected AvtoKrAZ’s complaint and confirmed that it must repay a debt of UAH 899 million due to the sale of its shares for the corresponding amount at auction.
In addition to Sberbank, other companies also have claims against AvtoKrAZ, and many of them are also owned by Konstantin Zhevago (for example, LLC Trading House AvtoKrAZ, PJSC Galichfarm, etc.).
The liquidators of some banks to which AvtoKrAZ had a debt also made demands on AvtoKrAZ: Delta Bank, Finance and Credit (formerly owned by Zhevago), Ukrexim, Prominvestbank.
A separate AvtoKrAZ legal case is a lawsuit filed by the Ministry of Defense. In 2013, AvtoKrAZ and the Ministry of Defense signed a contract for the supply of trucks. Due to the rise in the dollar exchange rate, the amount of the contract has increased, but the Prosecutor General’s Office considers the increase in the amount to be unlawful.
In addition, AvtoKrAZ is accused of delaying the delivery of trucks. In 2015, the court ruled in favor of the Ministry of Defense and ordered AvtoKrAZ to pay UAH 6.69 million. This has still not happened, so the police have been investigating these non-payments since November 2018.
Zhevago and his business: POTENTIAL RISKS
Considering the structure of Zhevago’s business interests, he may be interested in the following regulatory preferences:
- Minimization of duties on the import of equipment for own production – medicines and (subject to the continuation of AvtoKrAZ activities) cars.
- Continuation of the practice of concealing as much information as possible regarding the defense order and preventing foreign equipment manufacturers from accessing it.
- Introducing into the legislation on public procurement norms that allow discrimination against foreign manufacturers of medicines and medical devices in favor of domestic ones.
- Liberalization of the railway transportation market in such a way that vertically integrated companies like Ferrexpo have preferences over other shippers for transportation with their own rolling stock.
SPORT
Zhevago has been a sponsor of the honorary president of FC Vorskla from Poltava since 2004. The Poltava region is also where the oligarch’s most important assets are located.
Zhevago was elected as a people’s deputy in majoritarian constituencies for 6 consecutive terms, including due to his influence on the electorate due to football.
Thanks to these investments, Vorskla consistently performs in the Ukrainian Championship at an “above average” level and regularly participates in European cups.
Also, Zhevago’s Poltava Mining and Processing Plant financed Gornyak-Sport, a small team from the second strongest Ukrainian championship.
The activities of the oligarchs during a full-scale war
Konstantin Zhevago, the former owner of the Finance and Credit bank, is wanted by the Bureau of Economic Security of Ukraine. He was seen in Monaco in August 2022, enjoying a summer holiday on his yacht called Z. The Ferrexpo company, 51% owned by Zhevago, allocated $12.5 million. humanitarian fund.
Skelet.Info
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