Oleg Deripaska

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Oleg Deripaska Олег Дерипаска
Born	2 January 1968 Dzerzhinsk, Nizhny Novgorod Oblast, Russian SSR
Residence	Moscow, Russia
Alma mater	Moscow State University, Plekhanov Russian Academy of Economics
Occupation	CEO of Basic Element Company
Net worth	▼ US$3.5 billion (2009)[1]
Spouse(s)	Polina Deripaska (née Yumasheva)
Website Basic Element

Oleg Vladimirovich Deripaska (Russian: Олег Владимирович Дерипаска, /Olyég Vladímirovich Dyeripáska/, born 2 January 1968) is a Russian billionaire, Chief executive officer of Basic Element company and a member of the Board of Directors and CEO of United Company RUSAL, a Russian aluminium industry company.^[2] Deripaska has a London home in Belgrave Square, which was originally the town residence of the Dukes of Bedford.

Deripaska's estimated fortune was $28 billion in 2008, according to the Forbes billionaire list, making him the 9th richest man in the world.^[3] However his fortune has since declined to US$ 3.5 billion dollars.

Contents 1 Business interests 1.1 Basic Element 2 Other/Affiliations 3 Biography 3.1 Education and early career 3.2 Later career 4 Charity 5 Recent quotations 5.1 Lawsuits 6 Personal life 7 References 8 External links

[edit] Business interests

[edit] Basic Element

Deripaska is the sole owner and CEO of Basic Element, a diversified investment company established in 1997, with assets in Russia and abroad. Basic Element's main assets are concentrated in six sectors - energy, resources, manufacturing, financial services, construction and aviation. The major assets include United Company RUSAL^[4] the world's largest aluminium and alumina producer, GAZ Group automotive company, Ingosstrakh, the country's oldest insurance company, Bank SOYUZ (Банк «СОЮЗ»),^[5] Aviakor aircraft manufacturer, Russian-Asian Investment Company (or “RAInKo” — РАИнКо: Русско-Азиатская Инвестиционная Компания) ^[6], EuroSibEnergo (ЕвроСибЭнерго), an investment and energy supply company,^[7] Glavmosstroy (Главмосстрой), a planning and construction company.^[8]

Basic Element owns companies and subsidiaries in Russia, the CIS countries, Africa, Australia, Asia, Europe and Latin America. Basic Element has employed as many as 300,000 people.^{[citation needed]} In 2007, Basic Element's consolidated revenues exceeded US$26 billion. The market value of the company's assets is estimated at US$ 45 billion.^[9] But according to Izvestia and Wiener Zeitung, due to global financial downturns, Deripaska has a debt that may have reached as much as $14 billion by the end of 2008,^[10] probably the biggest loss in Russia,^[11] as a result of the running global financial crisis.

[edit] Other/Affiliations

Deripaska is one of 16 global business leaders who drafted CEO Climate Policy Recommendations to G8 Leaders, a document outlining international business community's proposals to effectively tackle global warming. The proposals were signed by more than 100 of the world's leading corporations and handed to Japanese Prime Minister Yasuo Fukuda on 20 June 2008. G8 leaders discussed the recommendations during the summit in Japan on 7 July - 9 July 2008. The process was coordinated by the World Economic Forum in collaboration with the World Business Council for Sustainable Development.^[12][13]

In 2004, Deripaska was appointed by the President of Russia to represent the country in the Asia-Pacific Economic Cooperation Business Advisory Council (ABAC). He has held the position of Chairman of ABAC Russia since 2007. Deripaska is Vice President of the Russian Union of Industrialists and Entrepreneurs, Chairman of the Executive Board of the Russian National Committee of the International Chamber of Commerce and a member of the Competitiveness and Entrepreneurship Council, an agency of the Russian Government.

He sits on the board of trustees of the Bolshoi Theatre, the School of Business Administration, the School of Public Administration, and the School of Economics at Moscow State University and the School of Business Administration at St. Petersburg State University. Deripaska is a co-founder of the National Science Support Foundation and the National Medicine Fund. In 1999, Deripaska received the Order of Friendship, a state award of the Russian Federation. He was named businessman of the year in 1999, 2006 & 2007 by Vedomosti, a leading business daily published in partnership with The Wall Street Journal and The Financial Times.

[edit] Biography

[edit] Education and early career

Deripaska was born in Dzerzhinsk, Nizhny Novgorod Oblast, but grew up in Krasnodar Krai. He graduated with honors in physics from the Moscow State University in 1993, and in 1996, he earned an economics degree from the Plekhanov Russian Academy of Economics. He was general manager of the Sayanogorsk Smelter (1994-97) and held the post of president of Sibirsky Aluminium Investment Industrial Group (1997-2001), which later became a core of Basic Element Investment Company.^{[citation needed]}

The Guardian mentions:^[14]

“

(…) The Soviet Union had just collapsed, the country was in turmoil and "decay"; Deripaska worked on building sites across Russia to prevent himself from starving. "We had no money. It was a very practical question every day. How do I get money to buy food and keep studying?" he recalls. There was little future in his university subject, theoretical physics. He abandoned his studies and started business as a small-time metals trader. Between 1993 and 1994 he accumulated a 20% stake in the Siberian aluminium factory - to the annoyance of the plant's communist-era bosses. "I was expecting they would treat me as a shareholder. But they said, 'No, you have the shares, but we run our business. And it's separate.'" [Deripaska persuaded the workforce not to go on strike and boosted production, in ways which are still not entirely clear.]

”

[edit] Later career

In 2005, he was included in the Sunday Times Rich List with an estimated wealth of £4,375m, but was not listed in 2006; however, according to an August 2006 article in the New York Times, the Russian business newspaper Vedomosti has estimated Deripaska's total wealth at $14 billion, which, if true, would either have made him Russia's richest man or possibly tied for the spot with Roman Abramovich.^[15].

He was said to have been the richest person in Russia, according to an 18 April 2008 Forbes report, with "a fortune of $28.6 billion -- $11.8 billion more than he was worth last year".^[1] Deripaska himself has consistently said that the estimate of his wealth was exaggerated, which did not completely account for the amount of debt he incurred, and that he should be ranked far below the top ten on the list of the Russian billionaires.^[16] In the 2009 Forbes report his net worth was calculated as $3.5 billion - a drop of $24.5 billion.^[1]

In 2006, GAZ Group, purchased all the shares of LDV Holdings (producer of light commercial vehicles, the city of Birmingham, Great Britain) from an American fund Sun Capital. The main product of LDV is the light commercial vehicle Maxus. In May 2009 GAZ Group signed an agreement to sell its UK/LDV van business to Malaysia automobile manufacturer and distributor Weststar.^[17]

In April 2007, Deripaska acquired 25 percent (€1.05 billion) of the Austrian construction company Strabag SE, which is owned by Hans-Peter Haselsteiner. Strabag is the sixth largest construction company in Europe.^[18] In May 2007, Magna International chairman Frank Stronach announced that Deripaska was becoming a strategic partner in Magna.^[19]

On 25 July 2008 GAZ Group launched the serial production of ^[20] sedan, which is based on a platform acquired from the American corporation Chrysler and was designed by the British studio UltraMotive. Engineers and specialists from Magna International played an active role in the installation and fine tuning of the cars assembly line, as well as in the training of the Group's employees. GAZ Group plans to add other models to the production at the assembly line.

On 3 October 2008 Magna International announced that Russian Machines terminated its participation as a shareholder of the Canadian auto parts maker. However the companies said that development of autocomponents business in Russia, as well as other joint projects, would continue.^{[citation needed]}

On 30 April 2009 Basic Element announced that it has transferred its 25% stake in Strabag to other shareholders of the company. Basic Element will also hold a call option to buy back the stake until 20 December 2009 with an opportunity of its extension to October 2010. Basic Element also retaines one registered share of Strabag and keeps two places on Strabag nine-seat supervisory board.^[21]

[edit] Charity

In 1998, Deripaska established the “Vol'noye dyelo” (Вольное дело: Free Business), Russia's largest private charity foundation (Russian Forbes magazine, May 2009).^[22] The fund supports over 400 initiatives across Russia aimed at developing education and science, preserving spiritual and cultural heritage, and improving standards in public health.^[23] It helps children, old people, talented youths, teachers, eminent scientists and other participants of the programs. Over the last three years the fund has coordinated a budget of $180 million and $65 million in 2008 alone. According to the fund's general director, Tamara Rumyantsyeva, the foundation is funded by Oleg Deripaska himself.^[24]

[edit] Recent quotations

• APEC Summit, Lima (Peru), 22 November 2008:

Oleg Deripaska made the following comments following the meeting of APEC Leaders in Lima, Peru, where he accompanied Russian President Dmitry Medvedev and led the Russian delegation to the APEC Business Advisory Council.^[25]

“

Today we have a huge stock of exchange goods, which are still being produced, because you can't shut the production capacity at once.... [And] until the world uses up the stock, there won't be a phase of growth in the real economy. Now it's important to come through the period before the supply meets the demand. In March-April we'll touch the bottom and we'll have a clear understanding of the demand and supply proportions.

”

• Bloomberg News: Deripaska Urges Russia to Buy Metals, Revive Demand

“

We have to live modestly for the next two years, helping the state to use resources in a more efficient way. Our task is waste reduction. The crisis won't last long. There is a crisis of overcapacity in production that each country will have to deal with. We can expect a decrease in production capacity by between 20 and 50 percent globally and I am afraid Russia will see some of it too.

”

“

A new partnership between the state and the business community is needed. We can bet on investment in housing and infrastructure. Investment in housing, roads, schools and utility services will help to keep afloat a chain of other sectors such as construction materials, machine-building, metallurgy. Such projects will also help to employ people who will lose jobs in other sectors. There will be losses from the crisis indeed; the task is to make them minimal. Businesspeople should trim their businesses, leaving only structures that will be needed in the next 15 years, while the government should attract new resources. The state should help those who suffered most. We (businessmen) will survive one way or another, while the crisis may ruin many ordinary people. Some of them (other entrepreneurs) are trying to save production capacities and keep prices high, waiting for a (recovery). This makes it difficult for others to restructure. For instance, high domestic prices for metals do not allow the production of cheaper cars. The hand of the state should become visible and solid. It is the government's responsibility to find the right balance between supply and demand, to find a price balance. This requires manual control. We are a lucky country in a way. As opposed to the West, where most basic consumer demands are already met, Russians tend to spend rather than to save once they get money in their hands. For instance, in more than 12 million families more than one generation live under the same roof. There is a huge objective demand for housing, and people will buy apartments if they are offered them at reasonable prices. The same goes for cars and many other things.

”

[edit] Lawsuits

On 24 November 2006, Michael Cherney brought legal action against Deripaska in the Commercial Court of the High Court in London.^[26] Cherney sought a declaration that he was the beneficial owner of 20 percent of Rusal's stock which, he claimed, Deripaska held in trust for him. The claim was denied. On 3 May 2007, Mr Justice Langley ruled that Deripaska had not been properly served and that the court had no jurisdiction to try the claim under English law, because Deripaska was not domiciled in England and Wales^[27]. On 3 July 2008, Mr Justice Christopher Clarke ruled that the case should be tried in England, although "the natural forum for this litigation is Russia", because, he held, "risks inherent in a trial in Russia... are sufficient to make England the forum in which the case can most suitably be tried in the interest of both parties and the ends of justice".^[28] On 22 July 2008, he granted Deripaska leave to appeal. The Court of Appeal of England and Wales refused the appeal on 31 July 2009.^[29]

[edit] Personal life

Deripaska was born in Dzerzhinsk, Russia, Nizhny Novgorod Oblast. He is married (to Polina Yumashev, daughter of Valentin Yumashev and stepdaughter of Tatyana Yeltsin) with two children.^[30]

[edit] References

[edit] External links

Wikimedia Commons has media related to: Oleg Vladimirovich Deripaska

• Moscow State University Alumni club: The richest people on the planet — Buffett is first, Deripaska ninth (Russian)
• Forbes (2009): The World's Billionaires — #164 Oleg Deripaska
• Люди (People) magazine: Oleg Vladimirovich Deripaska's biography (Russian)