Sunday, March 24, 2013

Boris Berezovsky: The rise and fall of an oligarch


9:00PM GMT 23 Mar 2013
 
Once a mathematics professor in the Soviet era, earning a pittance, he became one of the richest men in the world, a flamboyant billionaire who helped put two presidents in the Kremlin. He became the enemy of one of them and was forced into exile.
He lived in a world of limousines and private jets, penthouses and country estates, bodyguards and lawyers – but the details of his life were laid bare in a court room in London two years ago, when Berezovsky sued his former friend, Roman Abramovich, for breach of trust and breach of contract.
Berezovsky claimed that Mr Abramovich, now the owner of Chelsea Football Club, had failed to pay him what he was owed for a deal they allegedly made together in the ruins of the Soviet empire.
“I trusted him. I believed he was like my son,” said Berezovsky in court, a short, combative man looking like a dapper Danny DeVito in a blue suit and open-necked white shirt. “He betrayed me.”
As he spoke, his girlfriend, Elena Gorbunova, looked on. She was 20 years younger, at 42, but was his long-term partner and had given him two children.

Only a few months earlier, Berezovsky had agreed to the most expensive divorce settlement in British history, paying £220million to his former wife, Galina Besharova, mother of another two of his children. The couple had been legally married for 18 years, but only together for two of them.
Mr Abramovich denied there had ever been a deal over shares, and that he owed any money to Berezovsky. He admitted once paying him £800 million but said that was in return for the older man acting as a political godfather. The Russian term for it – krysha – translates as “roof”.
The two of them were among the handful of men who made vast fortunes by acquiring the formerly nationalised oil companies and other industries as the Soviet Union broke up.
Berezovsky, born in Moscow in 1946 and the son of a Russian-Jewish engineer and a nurse, first became a mathematics professor at Moscow University then embraced capitalism.
A car dealer first, he became a multi-millionaire through finance. With money, charm and contacts, he became useful to Boris Yeltsin after they met in 1993, and benefited just as much at a time when the economy was in chaos.
He took control of the oil company Sibneft and 49 per cent of the state television station ORT, and with his fellow oligarchs, funded a slick campaign to re-elect Yeltsin.
They also made loans to the state and, in return, were given shares in formerly nationalised companies, which earned them untold wealth. In 1997, having taken over the airline Aeroflot, he was named by Forbes magazine as the ninth most powerful entrepreneur in the world, worth $3 billion (£1.97 billion).
Ordinary Russians did not appreciate Berezovsky as much as those in power, seeing him as one of those to blame for the state of their country.
A bomb was planted, but his chauffeur died instead.
Berezovsky put his money behind Vladimir Putin’s successful bid for the presidency in 2000, and his television station carried out a highly effective smear campaign on the main rivals. However, aware of the public’s distaste for the oligarchs, Putin positioned himself against them.
Under pressure, Berezovsky resigned from the seat in parliament that had guaranteed him immunity and fled to France, then London.
When the Russian authorities tried to extradite him on charges of money-laundering and illegal business activity in 2002, Berezovsky said that his life would be in danger if he went back. The next year, he was granted asylum.
Russian television said that he was behind the murder of a Russian agent, Alexander Litvinenko, an associate of his in London.
Berezovsky denied any involvement and successfully sued for libel in the High Court in 2010. He would have been a key witness at the inquest – due next month – into the death.
He made himself comfortable in Britain, with his home at Wentworth Park, Ascot, Berks, where he died, and a taste for Mayfair restaurants.
It was while out shopping in Sloane Street in 2007 that Berezovsky happened to see his former friend, Mr Abramovich, in a luxury goods store.
Seizing the moment, he served a writ on Mr Abramovich that he carried around with him just in case, with the words: “I have a present for you.”
Berezovsky was suing for breach of trust and breach of contract, claiming that Mr Abramovich had broken an agreement made after they first met in 1994.
Mr Abramovich, then 28, had been a soldier but was doing well in the oil industry. They discussed a plan to merge and privatise an oil-drilling company and a refinery in Siberia.
Berezovsky later said that it was agreed that he and a friend would get a quarter of the shares of the new business, which became known as Sibneft, while the rest went to Mr Abramovich.
His rival said there was no such agreement, and that Berezovsky never had any shares at all. Mr Abramovich eventually sold his interests in Sibneft for £7.4 billion, and Berezovsky spent years trying to gain what he considered he was owed.
He spent a great deal of money on the case in London but lost it in 2012, and was called an “inherently unreliable” witness by the judge.
In recent times, his wealth was said to have been considerably reduced, not least by multiple legal battles.
Earlier this year, his former girlfriend, who had provided such visible support during the trial, claimed he owed her millions of pounds from the sale of a £25 million property.
It was revealed in court that Miss Gorbunova had won a £200 million freezing order on his assets after they split in 2012, fearing that he would not be able to pay the £5 million she was due from the house sale. Mr Justice Mann said evidence showed that Mr Berezovsky was a “man under financial pressure”.
The former mathematics professor who had acquired inconceivable wealth appeared to be finding that the numbers were against him.

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