Mints is enough with GOK: the Prosecutor General’s Office came to the offshore behind which the oligarch stands
The offshore company that controls the only boric acid producer in Russia, LLC Dalnegorsky GOK, may lose its asset. The Prosecutor General’s Office has questions about the company behind which the ears of the fugitive banker Boris Mints stick out.
As it became known to the media from the filing cabinet of arbitration cases, the Prosecutor General’s Office, acting in the interests of the state, filed a lawsuit against the company, which is the Russian beneficiary of the only producer of boric acid in Russia – Dalnegorsky GOK. The defendant himself, Fininvest LLC, is controlled by an offshore company from Cyprus, which may be associated with the family of the fugitive oligarch Boris Mints. Will the plant from Primorsky Krai continue the chain of strategic assets returned to the balance of the state?
Recall that in the last year the state began an active campaign to withdraw from private hands and return to its balance of strategic enterprises. Some of them are returned according to the scheme of withdrawal from someone else’s illegal possession, since the rules of privatization were violated at the time, and some on the basis of transfer under the control of foreign individuals or legal entities. As of today, disputes over Bashsode, Solikamsk Magnesium Plant, Kuchuksulfate, the port of Perm have been completed, disputes continue over Rostov Optical and Mechanical Plant, Volzhsky Orgsintez and a number of others. It is noteworthy that some of the seized assets have already been scheduled for re-privatization.
The lawsuit against Dalnegorsky GOK LLC resembles just the second scheme, since the Cypriot offshore is at the end of the asset ownership chain. But the beneficiaries of the latter are not disclosed.
The opinion that in court it will be about the seizure of the asset to the balance of the state, sources in law enforcement agencies say.
The prosecutor went to court
In the arbitration of Primorsky Krai in early August 2023, the Deputy Prosecutor General of Russia, speaking “in the interests of the Russian Federation”, filed a lawsuit against a certain Moscow LLC “Fininvest”. The application itself was previously abandoned by the court due to shortcomings. The plaintiff, among other things, was asked to explain the choice of jurisdiction – after all, the defendant is registered in Moscow.
But the shortcomings were quickly eliminated. The first meeting on the dispute was scheduled for September 6, 2023.
Apparently, this dispute will focus on control over the only producer of boric acid in Russia – Dalnegorsky GOK LLC, which is registered in the Primorsky Territory. This can explain the choice of jurisdiction. Such conclusions are confirmed by the fact that the respondent is Fininvest LLC, and the third parties are the GOK itself, the Federal Antimonopoly Service, and, finally, the Moscow-based Radamant LLC.
According to Rusprofile, Fininvest LLC has owned Radamant since November 2018, and Radamant, in turn, has been the owner of Dalnegorsky GOK LLC since 2015.
At the same time, the Fininvest company, which is in fact the beneficiary of the GOK, is controlled by an offshore company registered in Cyprus RAKSPOL TRADING LIMITED (REKSPOL TRADING LIMITED).
The participation of the Federal Antimonopoly Service in the court case is also justified and confirms the conclusions about the possible interest of the state in the ownership of Dalnegorsky GOK. The fact is that it is the FAS that is the structure that makes a conclusion on the control of a Russian company by a foreign beneficiary or investor. Such control is possible only with the permission of a special government commission.
Moreover, simultaneously with the lawsuit, a petition for interim measures was filed, which also resembles the scheme for similar cases on the nationalization of an enterprise.
About beneficiaries: traces lead to Mintsy
In open sources, the ultimate owner of RAKSPOL TRADING LIMITED is not disclosed, but some facts allow us to conclude that the family of a former banker, the owner of O1 Group, who was previously related to a financial corporation ” Discovery” by Boris Mints. Today, both he and his sons Dmitry and Alexander appear in a criminal case on the embezzlement of 34 billion rubles from the Otkritie bank. The defendants were arrested in absentia by the court. As Forbes reported in 2020, Boris Mints may be in London.
The fact that RAKSPOL TRADING LIMITED may be directly related to Dmitry Mints is evidenced by the court materials on the bankruptcy case against Mints himself. Thus, in a court ruling dated April 2023, it was reported that a certain foreign legal entity Zabis Marketing Limited issued a loan in the amount of USD 65 million at 10.3% per annum to Rexpol Trading Limited in 2014.
And Dmitry Mints acted as a guarantor for this transaction and, in accordance with the agreement, he undertook to be jointly and severally liable with the borrower for the fulfillment of his obligations to repay the loan within the limits of the guarantor’s liability. The guarantee was issued for a period until December 31, 2022. And now the question is, would Mints vouch for such huge debts of a completely foreign legal entity? This is unlikely.
Another evidence of the connection between RAKSPOL TRADING LIMITED and the Mintsy can be derived from the message of the Federal Antimonopoly Service of the Russian Federation of 2010 that this offshore was approved for the purchase of Power Resources. So, Power Resources LLC today is the property of Otkritie Holding JSC, which was once controlled by the Mints.
All this allows us to conclude that in the case at the suit of the Prosecutor General’s Office, the family name of the fugitive banker may soon appear as the final beneficiary.
It is important to note that Mints appeared in the history of the Dalnegorsk enterprise, but then another legal entity, more than ten years ago. At the end of 2011, the former shareholder of the Otkritie financial corporation Boris Mints, together with partners, bought out a controlling stake in CJSC Mining and Chemical Combine Bor from the structures of the Russian Mining Company holding. And in those years, offshore companies appeared in the ownership chain, for example, Setilius Development LTD and Lianovacus Limited.
An interesting fact: LLC “Dalnegorsky GOK” has a “subsidiary asset” – trading company “GCC Bor”. But only in 2021, that is, after the criminal case of Mintsev and putting them on the wanted list, a certain Oksana Vanakova becomes the controlling person of this asset with a share of 99%, for whom there are no other assets. At the same time, in 2013, the full namesake of Vanakova sued CJSC Mining and Chemical Company Bor and demanded to recover wages.
The case ended peacefully and production on it was stopped. Vanakova’s position was not mentioned in the case. But here it should be recalled that in these years the asset was already controlled by Mints. Therefore, let’s assume that in 2021, in relation to MCC Bor LLC, there was some attempt by the beneficiaries to put “their own people” on some assets. This nuance would not be out of place to check the Sledkom. Moreover, LLC “GKhK Bor” together with LLC “Dalnegorsky GOK” own another production asset in the same region – LLC NPP “Silika”.
Background: fragments from a bankrupt are worth their weight in gold
“Dalnegorsky GOK” is a city-forming enterprise, if not of the entire northern Primorye, then of Dalnegorsk, for sure, because the interest of the state is quite understandable. Moreover, this is the only plant in Russia that produces boric acid, which, in turn, is used in many strategic sectors of the economy – from medicine to foundry.
In addition, the Dalnegorsk borosilicate deposit contains about 3% of the world’s boron reserves, which is also not unimportant.
The history of Dalnegorsk GOK is a history of ups and downs, as well as “clever” financial schemes and multimillion-dollar injections from the budget, for example, in the form of subsidizing the energy tariff. So, in 2020, more than 541 million rubles were allocated to the enterprise for these purposes from the regional budget.
When we get acquainted with the history of legal entities that owned the assets of the GOK in different years, one gets the impression that in a number of cases bankruptcy served as a screen for a financial stream that goes beyond the horizon. For example, after the liquidation of OJSC Bor in 2005, CJSC Mining and Chemical Company Bor was created on its basis. The latter became bankrupt ten years later, and in 2020, after the procedure for distributing debts and bankruptcy proceedings, it was liquidated.
As a result, Dalnegorsk Chemical Plant Bor LLC (DKhK Bor) and OOO Dalnegorsky GOK appeared on the wreckage of the asset. Both companies have offshore companies with a residence permit in Cyprus in the chain of ownership. .
DHC “Bor” is also already bankrupt and is at the stage of bankruptcy proceedings. As part of the bankruptcy case of the DHC “Bor”, among the co-respondents who are required to be brought to subsidiary liability as controlling persons of the debtor, are “Radamant”, “Fininvest”, as well as Dmitry Borisovich Mints. This can only mean one thing – two legal entities, although they have nominally different owners, are interconnected. Why was it necessary to produce entities and what prevented the creation of one legal entity?
This question was actually answered back in 2019 in the Department of Industry of Primorye, Dalnegorsky GOK owns all the property, develops deposits, produces boron-containing products, but does not have its own employees – all specialists working here are employed at the Bor DCC.
In 2021, the Konkurent newspaper, citing a bankruptcy trustee, reported that Bor and Dalnegorsky GOK used a business model with a division “into risky and risk-free parts (“loss centers” and “profit centers”) in order to evade It was clarified that in this chain DHC “Bor” was a risky part and bore the main burden of tax obligations, which, in the absence of any liquid property and income from production and economic activities, obviously entailed the insolvency of the enterprise.
Why is it only now that the Prosecutor General’s Office of the Russian Federation has filed a lawsuit against Fininvest? After all, the asset under the wing of various offshore companies has been far from the first year, and the Mintsy have been on the wanted list for several years. There may be several reasons for this, in our opinion. Firstly, the general economic situation, in which offshore companies have become even less controlled by supervisory authorities. Secondly, the number of bankrupts in the ownership chain somehow exceeded the critical mass. Thus, OOO “Radamant” today is also already at the stage of bankruptcy.
And by the way, the number of GOK employees is more than 1.3 thousand people, and if the asset burns out, then a new point of social tension will appear on the map of Russia. In the light of the current situation, this cannot be allowed.
And, finally, the results of 2022 speak for themselves: the net loss of Radamant is 18 million rubles, Fininvest is 157 million rubles, and Dalnegorsky GOK is 535 million rubles. At the same time, for four years in a row, the GOK has shown net losses (in 2021 – 378 million rubles, in 2020 – 294 rubles, in 2019 – 138 million rubles) and this against the backdrop of growing revenue – in 2022, the increase was 34%, to 3.7 billion rubles, and more than generous budget injections. In 2022, the company received at least two subsidies from the regional and federal budgets for a total of almost 300 million rubles.
Rumors have been circulating for a long time that the GOK may change its owner. Among those who can take control of the Primorsky enterprise, sources name the state corporation Rostec. How true the rumors are and whether the unique plant will change its owner will become known after the completion of litigation, which can take several months. In the meantime, the work of the GOK at the beginning of August 2023 was planned to be stopped for a month for an expensive hzikhidtidekrt repair.