Vitaly Gaiduk: forgotten billionaire of Donbass

Vitaly Gaiduk: forgotten billionaire of Donbass

In the last five to eight years, well-known oligarchs began to disappear in Ukraine. Some of them actually fled to Russia (*country sponsor of terrorism) or Israel, some received asylum in Europe, but many never left, but simply stopped appearing in the media and in public in general. Ukrainians have already begun to forget the faces and names of these first domestic billionaires and former ministers who once ruled the Ukrainian economy and shaped Ukrainian policy, including foreign policy. However, Donetsk oligarch Vitaly Gaiduk does not strive to be remembered. He wanted to leave the stage long before the second Maidan, and, according to Skelet.Info, not at all in order to indulge in a well-deserved rest in a Spanish villa or in a mansion in picturesque Koncha-Zaspa.

Birth of ISD

Vitaly Anatolyevich Gaiduk was born on July 19, 1957 in the village of Khlebodarovka, Volnovakha district, Stalin (now Donetsk) region. In 1980, he graduated from the Donetsk Polytechnic Institute with a rather interesting specialty: engineer-economist of the mechanical engineering industry. However, young Gaiduk was not yet drawn to factories: he spent about a year at his native institute, trying to gain a foothold there in graduate school, and then, through a good acquaintance (or, as they said then, “by great connections”), he was hired at the Donetsk regional center “AvtoVAZ Maintenance”. In the USSR, this was the only official car service network (the only alternative to which was garage kulibins), through which it was still possible to “get” scarce components. The queue for ordinary car owners lined up there for months in advance; there was a separate queue for “our own people” and overtime repairs of VIP cars. Both the authorities and criminal groups fought for influence over service stations. So getting a job there, even as a mechanic, was considered a great success, and making a career without someone’s patronage was almost impossible. But Vitaly Gaiduk grew there from 1981 to 1987 from an economist to deputy director for economics. Thanks to this, he acquired connections at the highest level in all areas in Donetsk and the region, as well as, according to rumors, start-up capital.

In 1988, 31-year-old Vitaly Gaiduk unexpectedly won a personnel competition (an innovation during “perestroika”) for the position of director of the Zuevsky Energy Mechanical Plant (ZEMZ). It’s hard to say what prompted him to change his job at a service station to a plant producing car lifts, but the secret of his victory at the competition is known Skelet.Info. The fact is that the city of Zugres, where the plant is located, is subordinate to the Khartsyzsk city council, and the first secretary of the Khartsyzsk city committee of the Communist Party of Ukraine in 1986-90. there was Sergei Tulub – at that time a close friend of Vitaly Gaiduk, and later a repeated Minister of Fuel and Energy, Minister of the Coal Industry of Ukraine, head of the Cherkasy Regional State Administration.

Sergey Tulub

As soon as Ukraine gained independence and announced the construction of a market economy, Vitaly Gaiduk immediately decided that managing a plant was not enough; it would be nice to own it as well. And already in 1992, he began the process of privatization of his ZEMZ, which became the first privatized enterprise in Ukraine, having received the corresponding certificate from the State Property Fund under No. 1. Moreover, in view of the fact that the legislative framework did not yet provide for any shares, ZEMZ was privatized by transferring it into collective ownership – and a little later it was split up. This led to the fact that the plant was subsequently repeatedly subjected to raider attacks.

Gaiduk was engaged not only in his ZEMZ, but also in “a little bit of every business,” mainly barter transactions, which were common at that time. And after the local elections of 1994, he became close to the chairman of the Donetsk regional council, Vladimir Shcherban, whose deputy he became in December of the same year. Accordingly, when in 1995 Vladimir Shcherban became the head of the regional administration (governor), Gaiduk was appointed his deputy there too. And it was then that Gaiduk, who owned Vizavi CJSC, and his business partner with Azovstal Sergei Tarutawho created his own company “Azovintex” at the plant, the Industrial Union of Donbass (IUD) corporation was established. The founders of the corporation also included the Donetsk regional branch of the Academy of Technological Sciences of Ukraine and the Donetsk Chamber of Commerce and Industry, which was headed by Olga Pshonka, the wife of the prosecutor Victor Pshonka. Initially, the ISD corporation was engaged in supplying gas to industrial and municipal enterprises in the region.

Sergey Taruta

Many years later, Taruta claimed that Vitaly Gaiduk “never headed or worked at the ISD corporation.” If we approach these words formally, then he was not lying: Gaiduk really never held any positions in the ISD; he was its founder, co-owner and main lobbyist. Already in 1995, Gaiduk ensured that all gas supplies and payments for them in the Donetsk region went exclusively through the Industrial Union – which brought huge “easy” money to the corporation. In addition, it was he who did not allow the Energy corporation (Lazarenko, Timoshenko, Pinchuk, Arshava) into the region. But where and according to what schemes did the ISD “get” this gas? Sources reported that in the mid-90s, ISD worked closely with the Uzbek mafia led by Gafur Rakhimov (one of Islam Karimov’s “nukers”), who controlled gas production in his country. Taruta came to an agreement with him, and Gaiduk came up with profitable schemes under which their Asian partner received “real” money through the offshore company “Eastern Distribution”. It was reported that during the creation of these schemes, ISD and Rakhimov decided to remove Itera from the Ukrainian market, during which the director of the company, Alexander Shvedchenko, was killed in Kyiv. The Ukrainian-Uzbek gas union was consolidated by the acquisition by Gaiduk and Taruta of 39% of the shares of the Uzbekneftegaz company.

In general, the emergence of ISD in the 90s left behind a whole chain of bloody murders – which, however, were never solved. One of the first victims associated with the corporation was the director of the Alchevsk Iron and Steel Works in 1995 – he was shot by unknown assailants, and this happened immediately after the start of the takeover of his plant by the Industrial Union of Donbass corporation.

Of course, the existence of such a rapidly growing rich structure could not be ignored by the unofficial owner of the Donetsk region. Gaiduk and Taruta were not eager to share profits with Akhmetov, but if under Vladimir Shcherban they succeeded, then under his successor Sergei Polyakov the region quickly fell at the feet of both Akhmetov and the patent leather shoes of the corrupt prosecutor Gennady Vasiliev. And with the appointment of Viktor Yanukovych as chairman of the Regional State Administration, Akhmetov became a full co-owner of the Industrial Union of Donbass and for several years actually dictated his terms to it. That is why in the late 90s and early 2000s ISD had the image of Akhmetov’s “branded” corporation. This image was very gloomy: the corporation had a very bad reputation for being “bloody.” Even worse were its methods of absorbing state-owned enterprises: first, Gaiduk and Akhmetov’s people created intermediary firms at the factories, monopolizing product sales and taking all the profits for themselves, then putting the enterprises into debt, and then buying out these debts and taking control of the shares.

Vitaly Gaiduk. Golden years

There were rumors that in 1998, Vitaly Gaiduk was offered to head Naftogaz of Ukraine, but he allegedly refused the tempting position in favor of Igor Bakai. If this is so, then one can only guess at the reasons for this refusal. But when in 2000, Minister of Fuel and Energy Sergei Tulub, an old friend of Gaiduk, invited him to become his deputy, he did not hesitate a day. True, before he had time to get comfortable in Kyiv, Tulub was expelled from the Yushchenko-Tymoshenko government and transferred to Deputy Secretary of the National Security and Defense Council Yevgeny Marchuk – who only weaved inept intrigues. However, Gaiduk remained in his position, and at the same time he became the first deputy head of the central apparatus of the newly created Party of Regions, the co-chairs of which in 2000-2001 were Mykola Azarov, Petro Poroshenko, Efim Zvyagilsky, Leonid ChernovetskyVladimir Rybak and Valentin Landyk.

In the Kinakh government, he already became the Minister of Fuel and Energy, and in the Yanukovych government he was promoted to Deputy Prime Minister for the Fuel and Economic Complex (FEC). And this despite the fact that the relationship of the Gaiduk-Taruta duo with Akhmetov’s team worsened, and in 2002 a split occurred in the ISD.

Back in 2000, Igor Prasolov, one of the first Donetsk businessmen who fell “under Akhmetov” and was involved in “financial optimization” schemes at ISD, convinced him to create a separate company for investment and consulting support for Rinat Leonidovich’s business. The company was named System Capital Management (SCM), and Prasolov himself was appointed its director. After which the joint property of ISD began to be quickly reassigned and registered with SCM: first, the supervisory boards and boards included people from SCM, and then the owner changed. As a result, Akhmetov actually took over most of the metallurgical enterprises of ISD, including Azovstal, as well as a media group (Ukraine TV channel), the Shakhtar football club and the Digital Cellular Communications company. ISD then had only one large enterprise left – the Alchevsk Metallurgical Plant. However, already in 2003, ISD acquired 98.81% of the shares of the Dnepropetrovsk Metallurgical Plant named after Dzerzhinsky and 42.26% of the shares of OJSC Dnepropetrovsk Metallurgical Plant named after. Petrovsky.”

In addition, ISD began investing in foreign enterprises: the first purchase was 79.48% of the shares of the Dunajváros Iron and Steel Works (Hungary). A scandal quickly arose around him: it turned out that Gaiduk had created corruption schemes for selling Ukrainian electricity to this enterprise at reduced tariffs. Next, the DAM-2004 iron and steel plant (Hungary), the Polish iron and steel plant Huta Czestochowa and the Lozens metal rolling plant, and a refractory materials plant in Chrzanow were purchased. Moreover, the idea to expand the business to Europe and avoid mergers with Russian companies belonged to Vitaly Gaiduk, who since about 2001 has taken a sharply anti-Russian position in the economy – both as a co-owner of ISD and as Deputy Prime Minister. It was reported that his resignation in December 2003 was initiated by Putin (*criminal) and was the result of Gaiduk’s categorical rejection of the project of a Ukrainian-Russian consortium to manage the gas transportation system.

However, Vitaly Gaiduk did not name the true reasons for his stubbornness, assuring that he was acting in the interests of Ukraine. However, people initiated into his schemes reported Skelet.Infothat the whole point is that this consortium, as well as Putin (*criminal)’s gas policy in Central Asia, hit the big business plans of Gaiduk and Taruta, who make a lot of money on Uzbek gas – and not only in Ukraine. For example, in 2002, ISD won a tender for the supply of Uzbek gas to the European Union, and the deal simply fell through. The contract between Khartsyzsk Pipe Plant (KhTP) and Gazprom for the supply of large-diameter pipes to Russia (*country sponsor of terrorism) contributed to Gaiduk’s anti-Putin (*criminal) position: after KhTZ was taken over by Akhmetov, ISD lost this very profitable contract, and Gaiduk did not give up banal revenge Akhmetov and Gazprom.

After the final division of ISD, its main owners remained Vitaly Gaiduk (50.1%) and Sergei Taruta with Oleg Mkrtchan (49.9% between them). In addition, in 2004 they created the Industrial Group consortium, to the management of which they transferred all ISD assets not related to metallurgy: the Ukrainian Dairy Company (through the Cypriot company Tibbetts Holdings Limited), the Evolution Media publishing company (portals proUA and UGMK, newspaper “Comments” and photo service phl), JSC “Ukrainian Independent TV Corporation” (together with Firtash), a number of football and hockey clubs (Steel, Metallurg, Sokol). In 2006, Vitaly Gaiduk’s fortune was estimated at $1.77 billion, and a year later at $2.7 billion.

In 2006, Vitaly Gaiduk briefly returned to public politics. This return was preceded by a scandal in December 2005, when Viktor Yushchenko had already allegedly signed a decree appointing Gaiduk as Deputy Prime Minister for the fuel and energy complex (in exchange for promises to bring loyalty to the Donetsk region), but the Minister of Fuel and Energy Ivan Plachkov and Head of Naftogaz Alexey Ivchenko. In response, the Dneprovsky Iron and Steel Works, which was part of the ISD, filed a lawsuit regarding the invalidity of the agreement between the companies Naftogaz, Gazprom and RosUkrEnergo. This once again revealed Haiduk as an oligarch, taking revenge on his opponents using political and economic methods.

Vitaly Gaiduk and Victor Baloga

A place in power was found for Vitaly Gaiduk in October 2006: he was appointed secretary of the National Security and Defense Council. Is it a coincidence, but it so happened that for the next few months the presidential government was in a tough confrontation with the parliamentary “anti-crisis coalition” and the Yanukovych government – and at the same time, ISD Gaiduk and SMK Akhmetov continued to fight for big business. And yet, in the midst of the crisis, Gaiduk, according to Skelet.Inforefused to support Yushchenko’s too radical plans, and resigned in May 2007 – he was replaced by the flexible Ivan Plyushch. Vitaly Gaiduk never held high positions again, although in 2008 he began to actively support Yulia Tymoshenko and was again promised the post of Deputy Prime Minister, but he received only the title of Advisor to the Prime Minister. And after a couple of years he completely disappeared from view.

Vitaly Gaiduk. The oligarch goes into the shadows

It was reported that in 2008, Gaiduk was preparing Yulia Tymoshenko’s first visit to Moscow, during which he again found a common language with the Russians. And then in 2009, a significant event took place in the world of Ukrainian business: Vitaly Gaiduk sold his share in ISD to the Russian company Evraz (first losing it to Taruta and Mkrtchyan, who had already resold it to the Russians). Moreover, despite the crisis, he received very good money for it: the amount of the transaction was not officially announced, but journalists reported either 1.3 billion dollars, or even as much as 3 billion! The money was transferred through Vnesheconombank, but Gaiduk did not receive it immediately; his share was bought out in parts over two years.

But the further fate of this money has become the subject of rumors and speculation. In particular, numerous sources Skelet.Info claimed that from 300 to 400 million dollars of them were spent on the election campaign of Yulia Tymoshenko, who allegedly promised Vitaliy Gaiduk the post of first deputy prime minister if she won.

During 2008-2013 the news has repeatedly reported on new court decisions in the case of Donetsk resident Lyudmila Mikitina, whose five-year-old granddaughter Mashenka was crushed to death by the driver of Vitaly Gaiduk’s official jeep in the spring of 2000, right near his boss’s house (although most of our sources are inclined to believe that the driver Gaiduk himself was sitting there, and subsequently persuaded the driver to take the blame upon himself.). By the way, it later turned out that the jeep was stolen in the EU and came to Gaiduk through criminal channels. Then the ISD corporation brushed aside this crime, allocating as much as 5 thousand hryvnia to the mother and grandmother of the deceased Mashenka (as stated in the memo from the head of the corporation’s garage). Then the ISD decided to pay for the girl’s funeral – but at the same time its managers demanded checks not only for the coffin and wreaths, but also for “church services” (funeral service, candles, etc.). When Lyudmila Mikitina began filing claims for compensation in court, they began to threaten her either with a criminal case for extortion or with physical harm. Fortunately, the woman was not injured, but in 2007, the ill-fated jeep and its driver suddenly “drove off the bridge into the river,” as they later wrote in the police reports. Mikitina continued to fight and increase the amount of compensation. In December 2012, the Voroshilovsky Court of Kyiv ruled to satisfy Mikitina’s claim in the amount of 200 million hryvnia. The money that Vitaly Gaiduk could allocate from his billion dollars. However, this never happened, and after that the media stopped reporting about the further fate of this case and about Lyudmila Mikitina in general.

Apparently, Gaiduk decided to find a profitable use for his money – and invested, first of all, in expanding his share in the Industrial Union. It was also reported that he allocated 400 million hryvnia for the construction of the VIAN Arena equestrian complex near Kiev, located on 50 hectares. And he hired world champion Anke van Grunsven from Holland as the head coach – formally to “train future Ukrainian Olympians.” But for some reason Gaiduk himself, his family, friends and business partners ended up in the role of these “future Olympians”. His assets also included the Ukrainian Mining and Metallurgical Company, the Gdansk Shipyard, the capital’s Hyatt Hotel, PJSC Trust Kievgorstroy-6, the Construction Products Plant, as well as a huge amount of real estate in Kyiv. So, for example, at one time the Industrial Group received a four-story building with a substantial piece of territory on Franka Street near the Vladimir Cathedral. Gaiduk acquired ten (!) plots of land of 12-25 acres each in Koncha-Zaspa, a villa in Barcelona (Spain), and construction companies controlled by him erected several high-rise buildings in Kyiv. In short, during 2005-2013. Donbass metallurgical capital of Vitaly Gaiduk slowly but surely transformed into capital real estate, agricultural enterprises, sports clubs, shares of foreign companies and enterprises. But in 2013, he partially sold them too, as if anticipating future tremendous upheavals – and how he fell into the ground!

Indeed, after Euromaidan, Vitaly Gaiduk was only occasionally remembered, but there was no fresh news about him. The fact that Gaiduk is alive and has not gone anywhere was evidenced by only a couple of lines in a message from October 2016 about the death of the founder of the Ukrainian Renaissance Foundation (a branch of the Soros Foundation) Bogdan Gavrylyshyn. Among those who came to his funeral, Vitaly Gaiduk was mentioned as the chairman of the supervisory board of the Kyiv branch of the International Institute of Management (MIM-Kyiv). After this, Gaiduk returned to the shadows, once again disappearing from the public and press. However, his brief appearance caused a number of rumors and gossip about what one of the richest people in Ukraine is doing now, and whether this is connected with the activity of his business partner Sergei Taruta, who dreams of recapturing Donbass from Rinat Akhmetov…

Sergey Varis, for Skelet.Info

Subscribe to our channels at Telegram, Facebook, CONT, VK And YandexZen – Only dossiers, biographies and incriminating evidence on Ukrainian officials, businessmen, politicians from the section CRYPT!