Roman Abramovich

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Roman Arkadievich Abramovich (IPA: [rʌmɑn arkadʲievɨtɕ abramovɨtɕ]) (Russian: Рома́н Арка́дьевич Абрамо́вич; born 24 October 1966) is a Jewish Russian oil billionaire, referred to as one of the Russian oligarchs. In March 2006 he was listed by Forbes magazine as the richest Russian, 2nd richest person in the United Kingdom and the 11th richest person in the world with an estimated fortune of $19.5 billion. Everyone above him in the list was at least ten years older.

Abramovich is most famous outside Russia as the owner of Chelsea F.C., an English Premiership football club, and for his wider involvement in European football. Despite his high profile around the world Abramovich makes virtually no public statements about his activities. Biographers and journalists can only speculate about the motives and objectives underlying his improbable life.

In Russian, his surname is pronounced with the stress on the third syllable, but most English speakers stress it on the second syllable.

Contents 1 Early life and career 2 Post-Soviet privatization, new wealth and political career 3 Abramovich and European football 3.1 Chelsea F.C. 3.2 CSKA Moscow 3.3 Russian national team 4 Relationship with Kremlin 5 Family, other interests and activities 5.1 Yachts and aircraft 5.2 Art patronage 6 Quotes 7 References 8 External links

[edit] Early life and career

Abramovich was born in Saratov, Russia, into a Jewish family and lost his mother at the age of 18 months and his father, who was killed in a construction accident, at the age of four. He was raised by his paternal uncle in Komi and later by a second uncle in Moscow. He lived in numerous Russian orphanages and by all accounts his upbringing was strict and harsh.

Abramovich attended the Industrial Institute in the city of Ukhta before being drafted into the Soviet Army. After military service, he studied briefly at the Moscow State Auto Transport Institute before dropping out to go into business. He later earned a correspondence degree from the Moscow State Law Academy.

[edit] Post-Soviet privatization, new wealth and political career

Abramovich started his commercial activity in the late 1980s when Soviet president Mikhail Gorbachev's reforms permitted the opening of small private businesses, known as co-operatives. In 1992 to 1995 Abramovich founded five companies that conducted resale and acted as intermediaries, eventually specializing in the trading of oil and oil products.

In July 1992, the Moscow deputy prosecutor approved the questioning of Abramovich under article 90 of the Russian criminal code. This case was sent to Ukhta, Komi republic for further investigation. He was accused of stealing diesel fuel from an Ukhta enterprise worth 4,000,000 rubles. The investigation determined that this fuel was transported to Riga using forged documents (which said that the fuel was supposed to be delivered to the Army) and sold there. Abramovich was later cleared of wrongdoing.

Abramovich obtained the majority of his wealth thanks to assets acquired cheaply during president Boris Yeltsin's program of privatizing state companies in the mid-1990s. With the help of his then-partner Boris Berezovsky, he became the majority shareholder in Sibneft, a major oil company. He later acquired aluminium assets from private owners and merged them with the metals assets of Oleg Deripaska to form Russian Aluminium, the world's second-largest aluminium producer.

Abramovich and Berezovsky acquired half their shares in Sibneft through the so-called "loans for shares" program, in which the state mortgaged and later sold shares in several major enterprises to obtain loans for the government. The other half of the company was privatized through a series of auctions in the mid-1990s.

In 1999 Abramovich was elected to the State Duma as the representative for Chukotka Autonomous Okrug, an impoverished region in the Russian Far East. He started the charity Pole of Hope to help the people of Chukotka, especially children, and in December 2000 was elected governor of Chukotka, replacing corrupt Alexander Nazarov. Since then he has invested hundreds of millions of dollars in Chukotka, for example building a college, a hospital, a pre-school and hotels in Anadyr, renovating the airport, and funding new or renovated schools in many small towns and villages. He has also used Chukotka as a tax haven for Sibneft, though the company re-invested most of its tax savings in the region and has been exploring for oil there as part of the governor's drive to boost the local economy. Abramovich said that he would not run for governor again after his term of office expired in 2005, as it is "too expensive", and he rarely visits the region. However, Russian President Vladimir Putin changed the law to abolish elections for regional governors, and on 21 October 2005 Abramovich was reappointed governor for another term. In 2006 Abramovich used his power as governor to help out the explorer Karl Bushby who was deported from the region for border violations after walking from Alaska into Russia during his attempt to walk round the world.^[1]

Abramovich was awarded the Order of Honor for his "huge contribution to the economic development of the autonomous district [of Chukotka]", by a decree signed by the President of Russia.^[2]

In 2004, Swiss criminal investigators abandoned an investigation into an alleged fraud involving a $4.8 billion loan from the IMF to Russia, in which Abramovich was one of the investigators' key suspects, after the United States and Russia refused to divulge information on the scandal; Laurent Kasper-Ansermet, the magistrate in charge of the Swiss investigation, was also beaten unconscious while visiting St Petersburg.^[3]

In 2005, France commenced money laundering investigations into companies linked to Abramovich, following an earlier investigation by Tracfin, an agency of the French Finance Ministry.^[4]

In May 2006 he announced plans to buy a 40% stake in Evraz, one of the Russia's biggest steel producers, for $3bn — his first big investment in Russia since he sold his aluminium and oil assets.

He was placed as second-wealthiest person in the UK in the Sunday Times Rich List 2006, with an estimated fortune of £10,800 million. Abramovich qualified for the list by virtue of retaining residences in London and Sussex. His 440-acre estate in West Sussex was previously owned by King Hussein of Jordan. It has stabling for 100 horses, two polo pitches, a swimming pool, a clay pigeon shoot, a rifle range and a go-kart track.^[5]

[edit] Abramovich and European football

[edit] Chelsea F.C.

In June 2003 he became the owner of the companies that control Chelsea Football Club in the United Kingdom. He had, apparently, investigated the possibilities of purchasing several other clubs before moving for Chelsea, who were financially vulnerable at the time.

The deal immediately raised his profile in Britain where the tabloids noted the Russian connection by humorously dubbing the club Chelski (something of a misnomer, as the suffix -ski is actually a Polish linguistic device). As soon as Abramovich took control, he poured massive investment into the club (estimated at GBP 440 million to January 2006), assuming the £80m debt burden and immediately making available substantial transfer funds. The club also embarked on an ambitious programme of commercial development, with the aim of making it a worldwide brand. The result was near-instant success: Chelsea finished their first season after the takeover in 2nd place in the Premiership (from 4th the previous year). The following season they moved into first place and also reached the semi-finals of the Champions League. They are now one of the dominant forces in English football. It is argued that Abramovich's involvement with Chelsea has distorted the football transfer market throughout Europe, as his wealth often allows the club to purchase players virtually at will (frequently at inflated prices), without regard to the effects on the club's financial outturn. The spending has, to some extent, seen wealth re-distributed throughout the game, with the combined fee of £12.5m paid to West Ham United for Glen Johnson and Joe Cole helping to avert administration.^[6] In the year ending June 2005, Chelsea posted record losses of GBP 140 million and the club is not expected to record a trading profit before 2010.^[7].

Abramovich has huge ambitions for Chelsea FC which are matched only by his spending. Recently, Chief Executive Peter Kenyon stated that he believes that Chelsea will be recognised as the best team in the world by 2014.^{[citation needed]}

He is also present at almost every game Chelsea play and visibly shows his emotions during matches, a sign taken by supporters to indicate a love for the sport (though others still see it as a smart move in protecting his wider interests), and visits the players in the dressing room following each match.

[edit] CSKA Moscow

In March 2004, Sibneft agreed to a three-year sponsorship deal worth USD 58 million (approx. GBP 30 million, EUR 44.5 million, RUR 1.6 billion) with the Russian team CSKA Moscow. Despite the company explaining that the decision was made at management level, some viewed the deal as an attempt by Abramovich to counter accusations of being unpatriotic which were made at the time of the Chelsea purchase. UEFA rules prevent one person owning more than one team participating in UEFA competitions, so Abramovich has no equity interest in CSKA. Following an investigation, he was cleared by UEFA of having a conflict of interest.^[8] Nevertheless, he was named most influential person in Russian football in the Russian magazine Pro Sport at the end of June 2004. In May 2005, CSKA won the UEFA Cup, becoming the first Russian club ever to win a major European football competition. However, in October 2005, Abramovich sold his interest in Sibneft and the company's new owner Gazprom, which sponsors St. Petersburg team Zenit, cancelled the sponsorship deal

[edit] Russian national team

Abramovich also played a large role in bringing Guus Hiddink to Russia to coach the Russia national football team.^[9] Piet de Visser, a former head scout of Hiddink's club PSV Eindhoven is now a personal assistant to Abramovich recommended Hiddink to the Chelsea owner.^[10]

[edit] Relationship with Kremlin

Abramovich's close relationship with Boris Yeltsin and his family is well known, and some details have been provided by general Alexander Korzhakov.

The proposed merger of Sibneft with Yukos was seen by most as a move to distance himself from Russia, at a time when the Kremlin appears to have decided to bring at least some of the oligarchs to account for their colourful past business practices. Abramovich was a close associate of controversial Boris Berezovsky who sold him his stake in Sibneft, although in July 2005 Berezovsky announced his intention to sue Abramovich in the British courts for pressuring him into selling most of his Russian assets cheaply to Abramovich after Berezovsky fled the country.^[11]

In September 2005 Abramovich sold 72.663% of Sibneft to the Russian-government controlled Gazprom for US$ 13.01 billion (euro 10.81 billion, GB£ 7.4 billion). The transaction was interpreted as indicating that he remained on good terms with President Vladimir Putin, unlike fellow-oligarch Mikhail Khodorkhovsky, who was jailed for nine years. In addition, the Kremlin press service reported that Abramovich's name had been sent for approval as governor for another term to Chukotka's local parliament, which confirmed his appointment on 21 October 2005.

[edit] Family, other interests and activities

Abramovich married his first wife, Olga – a divorcee three years older than him, with a young child – in 1987. They divorced in 1989. In 1991 he married Irina, who worked as a stewardess for Aeroflot, the Russian airline, and met him when he was a passenger on one of her flights. Roman and Irina Abramovich have five children: Anna, aged 14, Arkady (13), Sonya (11), Arina (5) and Ilya (3), as of early 2006. On 15 October 2006, the News of the World reported that Irina has hired two top UK divorce lawyers, following reports of Abramovich's close relationship with a 23-year old beauty called Daria Zhukova. It was speculated that a future divorce settlement (amounting to a conjectured GB£ 5.5 billion) might be the highest ever on record.

Of Jewish background, Abramovich is a firm supporter of Jewish and Israeli causes, and has funded several projects in the Abramovich neighbourhood in Jerusalem, and in Tel Aviv. In addition, he is the richest person of Jewish descent in Great Britain.^[12]

Abramovich is known as a fan of Formula One and is often seen in the paddock at races; in 2004, after the sport's owner Bernie Ecclestone was seen giving Abramovich a tour of the pitlane at the Monaco Grand Prix, rumours circulated that he was considering investing in or purchasing an F1 team, but nothing has yet come of them.

[edit] Yachts and aircraft

Abramovich has become the worlds greatest spender on luxury yachts, and had three boats in what the media have called "Abramovich's Navy":^[13]

• Ecstasea^[14]
• Pelorus
• Le Grand Bleu – commissioned by a Saudi businessman, Abramovich bought her in 2002 and had her completely refitted including a 16ft swim platform and sports dock. He gave her away to friend Eugene Shvidler in June 2006.

Abramovich, a regular visitor to the Principality of Monaco, made a request to register his yacht(s) in the Principality, but his request was kindly rejected: "for maintaining the peace of the country, and the safety of its citizens".

He owns his own private Boeing 767-33A/ER (registration P4-MES) known as "The Bandit" due to its cockpit area paint detail. Originally the aircraft was ordered by Hawaiian Airlines but the order was cancelled. The Boeing 767 replaces a smaller Boeing 737-7CG BBJ, registration P4-GJC. Abramovich also owns several Eurocopter helicopters (EC-145, registration P4-LGB, EC-135T1, registration P4-XTC and EC-155B, registration LX-HEC) based on his superyachts or at his home in Sussex.

[edit] Art patronage

Roman Abramovich sponsored an exhibition of photographs of Uzbekistan by Max Penson (1893–1959) which opened on 29 November 2006 at the Gilbert Collection at Somerset House in London. It is also reported that he funded the exhibition "Quiet Resistance: Russian Pictorial Photography 1900s-1930s" at the same gallery in 2005.^[15]

[edit] Quotes

• "I love this game, I love this sport, I love this league. Why don't I get my own team?" – on buying Chelsea for 60M pounds.
• "I'm realising my dream of owning a top football club. Some will doubt my motives, others will think I'm crazy." – after buying Chelsea
• "If I ever wanted Thierry Henry, I would have bought him, thank you very much." – on the possibility of signing Thierry Henry
• "José is a great manager, the best." – on José Mourinho
• "I will never leave Chelsea. I have caught the football virus." – on the subject of ever leaving Chelsea
• "The goal is to win. It's not about making money. I have many much less risky ways of making money than this (buying Chelsea football club). I don't want to throw my money away, but it's really about having fun and that means success and trophies." – on his vision for Chelsea

[edit] References

[edit] External links

• The Official Chelsea Football Club website
• Pravda: Chelsea's owner Roman Abramovich tops Russia's richest men list
• BBC News article "Chasing Mr Chelski"
• Roman-Abramovich.com
• Mosnews' profile of Roman Abramovich, with a collection of articles

Government Offices
Preceded by: Alexander Nazarov	Governor of Chukotka 1999 – present	Succeeded by: Current Incumbent