A Russian court has ordered the seizure of a luxury hotel complex owned by billionaire Oleg Deripaska, one of the few oligarchs to have criticised President Vladimir Putin’s war in Ukraine, in a sign of the pressure facing the country’s tycoons since the invasion.
The legal dispute, following an initial claim brought by a science and educational hub under Mr Putin’s patronage, predates the invasion and is not ostensibly linked to Mr Deripaska’s guarded criticism of the war, which he has called “madness”.
But the court order to seize the $1bn Imeretinskiy hotel complex and marina in Sochi came after the Kremlin asked Deripaska to stop criticising the war, according to two people familiar with the matter.
“The Kremlin asked him to calm down,” said one person close to Deripaska.
Mr Deripaska, who is a key shareholder in the Limerick’s Aughinish Alumina, has been under US sanctions since 2018 over his links to the Kremlin. But the metals tycoon is the most prominent of the small number of Russian business leaders who have spoken out since Moscow’s full-scale invasion of Ukraine in February. “We need peace as soon as possible, as we have already passed the point of no return,” he wrote on Twitter in March.
The Kremlin asked him to tone down his criticisms that same month, according to another person close to the oligarch, and has repeated that request at least once since.
Many oligarchs privately oppose the war, although few have made public comments. Several have told the Financial Times that they are afraid to disagree publicly with the Kremlin, citing fears of repercussions for them and their businesses.
Yet in June Mr Deripaska warned that “destroying Ukraine would be a colossal mistake”, even as he shied away from criticising Putin personally.
Two weeks later, the Sirius Federal Territory, a science, educational and tourism cluster established under Putin, filed three land dispute lawsuits against RogSibAl, Deripaska’s company that owns the Imeretinskiy complex.
Mr Putin’s decision in 2020 to grant Sirius the status of federal territory — giving it its own government and budget — had meant it became in effect RogSibAl’s landlord. The science cluster and hotel complex are adjacent to each other on the Black Sea coast.
Publicly available court documents seen by the FT show that the judge ruled in favour of Sirius in September, evicting RogSibAl, with a separate judgment the same month ruling to seize all his company’s real estate.
Sirius’s parent foundation, Talent and Success, is co-owned by Sergei Roldugin, a cellist friend of Mr Putin’s who is godfather to the president’s daughter Maria. Mr Putin is chair of Talent and Success’s supervisory board. The US described Mr Roldugin as a “custodian” of Putin’s “offshore wealth” when it placed him under sanctions in June.
Elena Shmeleva, Sirius’s director, was a candidate for Mr Putin’s party in last year’s elections, although she did not become an MP. Television presenter Vladimir Pozner last year introduced Shmeleva in an interview by saying her “influence boggles the mind. Ministers and the heads of major companies fly to Sochi for meetings with her at the first invitation.”
Referring to Mr Putin, Dmitry Peskov, the president’s spokesman, told the FT that “Sirius is indeed his baby, he’s the one who came up with the idea...but this has nothing to do with the court cases”.
He also said it was “absolutely incorrect” to suggest the cases were linked to Mr Deripaska’s statements about the war. “He never spoke out against the operation” in Ukraine, Mr Peskov said. “Like many, he’s pushing for everything to be done better and more efficiently...he’s stating his point of view.”
A spokesperson for Deripaska did not reply to a request for comment. Neither Sirius nor Russia’s prosecutor-general office replied to requests for comment.
Sochi became an investment hub after it was awarded the 2014 Winter Olympics, with more than $50bn poured into the city and surrounding area.
Nearly half the tab was picked up by businesspeople such as Mr Deripaska, who spent about $1 billion (€941.5 million) on an Olympic village and cargo port that he later sought to turn into luxury accommodation with a marina. What is now the Imeretinskiy complex stretches 1.5km along the coast, with numerous hotel buildings and apartment blocks with swimming pools.
Mr Putin set up Sirius as a centre to train Russia’s brightest children on an adjacent site after the Olympics. Initially a way to prevent the Games’ infrastructure from becoming white elephants, the idea took on a life of its own. Deripaska is among the dozens of oligarchs and state companies to have donated to Sirius’s parent foundation, giving it a total of Rbs360mn (€4.7 million).
But that did not prevent Sirius from enlisting the local authorities’ help in June to determine whether RogSibAl had violated its rental agreements, on grounds that it had not really redeveloped the port into a marina and had built “unauthorised structures” in the former Olympic village. The judge in Krasnodar sided with Sirius, even though publicly available images show yachts moored there.
Days after that ruling in September, Russia’s deputy prosecutor-general filed a separate suit against RogSibAl in Moscow city court.
The Moscow case briefly reopened last month, allowing court documents to become public for the first time. They showed prosecutors sought to seize the Imeretinskiy complex and “transfer the property to the Russian Federation”. The documents show that “measures to secure the claim” had been taken, including “seizing all real estate” belonging to RogSibAl.
The Moscow case had proceeded quickly by Russian standards, according to a timeline on the court website. It was filed on September 9th and the judge ruled by September 15th.
The rulings against Mr Deripaska’s company illustrate the changing fortunes of Russia’s oligarchs, whose political fortunes have faded as the Kremlin has ramped up state control of the economy to fund its sputtering Ukraine war.
“Everyone is feeling under pressure,” said one executive. “You need to develop the right relationships with important people, fund the right social projects and be seen as doing the right thing.”
Copyright The Financial Times Limited 2022
