Roman Abramovich
Roman Arkadyevich Abramovich is a Russian business oligarch and politician. He is the former owner of Chelsea, a Premier League football club in London, England, and is the primary owner of the private investment company Millhouse. He has Russian, Portuguese and Israeli citizenship.
He was formerly Governor of Chukotka Autonomous Okrug from 2000 to 2008. According to Forbes, Abramovich's net worth was 14.5 billion in 2021, making him the second-richest person in Israel. Since then, his wealth decreased to $6.9 billion before rising again to $9.2 billion in 2023. Abramovich enriched himself in the years following the collapse of the Soviet Union in the 1990s, obtaining Russian state-owned assets at prices far below market value in Russia's controversial loans-for-shares privatization program. Abramovich is considered to have a good relationship with Russian president Vladimir Putin, an allegation Abramovich has denied.
Early life
Roman Arkadyevich Abramovich was born on 24 October 1966 in Saratov, Russian SFSR, Soviet Union. His mother, Irina, was a music teacher who died when Abramovich was one year old. His father, Aaron Abramovich Leibovich, worked in the economic council of the Komi ASSR, and died when Roman was three. Both parents were of Jewish descent. Roman's maternal grandparents were Ukrainian Jews Vasily Mikhailenko and Faina Borisovna Grutman. It was to Saratov in the early days of World War II that Roman's maternal grandmother fled from Ukraine. Irina was then three years old. Roman's paternal grandparents, Nachman Leibovich and Toybe Stepanovna Abramovich, were Belarusian Jews. They lived in Belarus and, after the revolution, moved to Tauragė, Lithuania, with the Lithuanian spelling of the family name being Abramavičius.In 1940, the Soviet Union annexed Lithuania. Just before the Nazi German invasion of the USSR, the Soviets "cleared the anti-Soviet, criminal and socially dangerous element" with whole families being sent to Siberia. Abramovich's grandparents were separated when deported. The father, mother and children – Leib, Abram and Aron – were in different camps. Many of the deportees died in the camps. Among them was the grandfather of Abramovich. Nachman Leibovich died in 1942 in the NKVD camp in the settlement of Resheti, Krasnoyarsk Territory.
Having lost both parents before the age of 4, Abramovich was raised by relatives and spent much of his youth in the Komi Republic in northern Russia.
Career
Business career
Abramovich entered the business world during his army service. He first worked as a street-trader, and then as a mechanic at a local factory. Abramovich attended the Gubkin Institute of Oil and Gas in Moscow, then traded commodities for the Swiss trading firm Runicom.In 1988, as perestroika created opportunities for privatisation in the Soviet Union, Abramovich gained a chance to legitimise his old business. He and his first wife, Olga, set up a company making dolls. Within a few years his wealth spread from oil conglomerates to pig farms. He has traded in timber, sugar, food stuffs and other products.
In 1992, Roman Abramovich was arrested and briefly imprisoned on charges of theft of government property. The case centered on the alleged theft of a trainload-specifically, 55 tankers-of diesel fuel from the Ukhta Oil Refinery. According to multiple investigative reports, Abramovich used forged documents to intercept the train in Moscow and redirect the shipment to a military base, where the diesel was then sold off. The value of the stolen fuel was estimated at 3.8 million rubles. Despite the seriousness of the charges, Abramovich was not ultimately prosecuted. Lawyers later claimed the incident was a misunderstanding, and the case was dropped after the oil refinery was compensated for its losses.
Friendship with Boris Berezovsky
According to two different sources, Abramovich first met Berezovsky either at a meeting with the Russian businessmen in 1993 or in the summer of 1995.Berezovsky and Abramovich registered an offshore company, Runicom Ltd., with five subsidiaries. Abramovich headed the Moscow affiliate of the Swiss firm, Runicom. In August 1995, Boris Yeltsin decreed the creation of Sibneft, of which Abramovich and Berezovsky were thought to be top executives.
Acquisition of Sibneft, loans-for-shares, and aluminium wars
In 1995, Abramovich and Berezovsky acquired a controlling interest in the large oil company Sibneft in a rigged auction. The deal took place within the controversial loans-for-shares programme and each partner paid US$100 million for half of the company, above the stake's stock market value of US$150 million at the time, and rapidly turned it up into billions. The fast-rising value of the company led many observers, in hindsight, to suggest that the real cost of the company should have been in the billions of dollars. As of 2000, Sibneft annually produced US$3 billion worth of oil.The Times claimed that he was assisted by Badri Patarkatsishvili in the acquisition of Sibneft. After Sibneft, Abramovich's next target was the aluminium industry. After privatisation, the "aluminium wars" led to murders of smelting plant managers, metals traders and journalists as groups battled for control of the industry. Abramovich was initially hesitant to enter into the aluminium business, claiming that "every three days someone was murdered in that business". Abramovich sold Sibneft to the Russian government for $13 billion in 2005.
Relationship with Boris Berezovsky and Badri Patarkatsishvili
In 2011, Abramovich's longtime business partner filed a civil suit, Berezovsky v Abramovich, in the High Court of Justice in London. He accused Abramovich of blackmail, breach of trust and breach of contract. The suit sought over £3 billion in damages.On 31 August 2012, the High Court dismissed the lawsuit. The High Court judge stated that because of the nature of the evidence, the case hinged on whether to believe Berezovsky or Abramovich's evidence. The judge found Berezovsky to be "an unimpressive, and inherently unreliable witness, who regarded truth as a transitory, flexible concept, which could be moulded to suit his current purposes", whereas Abramovich was seen as "a truthful, and on the whole, reliable witness".
Evidence in the case
In 2011, a transcript emerged of a taped conversation that took place between Abramovich and Berezovsky at Le Bourget airport in December 2000. Badri Patarkatsishvili, a close acquaintance of Berezovsky, was also present and secretly had the conversation recorded. During the discussion, Berezovsky spoke of how they should "legalise" their aluminium business, and later claimed in court that he was an undisclosed shareholder in the aluminium assets and that "legalisation" in this case meant to make his ownership "official". In response, Abramovich states in the transcript that they cannot legalise because the other party in the 50–50 joint venture would need to do the same, in a supposed reference to his business partner Oleg Deripaska. Besides Deripaska, references are made to several other players in the aluminium industry at the time that would have had to "legalise" their stake. Abramovich's lawyers later claimed that "legalisation" meant structuring protection payments to Berezovsky to ensure they complied with Western antimoney-laundering regulations.The Times also observed:
According to court-papers submitted by Abramovich, Abramovich mentions in the court-papers:
Investments in technology
In 2015, Abramovich invested and led a $30 million round of funding with businessman OD Kobo Chairman of PIR Equities. Other partners include several well-known people from the music industry, among them David Guetta, Nicki Minaj, Tiësto, Avicii, will.i.am, Benny Andersson, Dave Holmes and others.Also Abramovich has invested over $30 million in StoreDot, founded by Doron Myersdorf.
Football
Chelsea Football Club
In June 2003, Abramovich became the owner of the companies that control Chelsea in West London. The previous owner of the club was Ken Bates, who later bought rivals Leeds United. Chelsea immediately embarked on an ambitious programme of commercial development, with the aim of making it a worldwide brand at par with footballing dynasties such as Manchester United and Real Madrid, and also announced plans to build a new state-of-the-art training complex in Cobham, Surrey.Since the takeover, the club has won 21 major trophies – the UEFA Champions League twice, the UEFA Europa League twice, the UEFA Supercup once, the FIFA Club World Cup once, the Premier League five times, the FA Cup five times, the League Cup three times, and the FA community shield twice, making Chelsea the most successful English trophy winning team during Abramovich's ownership, equal with Manchester United. His tenure has also been marked by rapid turnover in managers. Detractors have used the term "Chelski" to refer to the new Chelsea under Abramovich, to highlight the modern phenomena of billionaires buying football clubs and "purchasing trophies", by using their personal wealth to snap up marquee players at will and distorting the transfer market, citing the acquisition of Andriy Shevchenko for a then-British record transfer fee of around £30 million.
In the year ending June 2005, Chelsea posted record losses of £140 million and the club was not expected to record a trading profit before 2010, although this decreased to reported losses of £80.2 million in the year ending June 2006. In a December 2006 interview, Abramovich stated that he expected Chelsea's transfer spending to fall in the years to come. UEFA responded to the precarious profit/loss landscape of clubs, some owned by billionaires, but others simply financial juggernauts like Real Madrid, with Financial Fair Play regulations.
Chelsea finished their first season after the takeover in second place in the Premier League, up from fourth the previous year. They also reached the semi-finals of the Champions League, which was eventually won by the surprise contender Porto, managed by José Mourinho. For Abramovich's second season at Stamford Bridge, Mourinho was recruited as the new manager, replacing the incumbent Claudio Ranieri. Chelsea ended the 2004–05 season as league champions for the first time in 50 years and only the second time in their history. Also high was Abramovich's spending regarding purchases of Portuguese football players. According to record newspaper accounts, he spent 165.1 million euros in Portugal: 90.9 with Benfica players and 74.2 with Porto players.
During his stewardship of the club, Abramovich was present at nearly every Chelsea game and showed visible emotion during matches, a sign taken by supporters to indicate a genuine love for the sport, and often visited the players in the dressing room following each match. This stopped for a time in early 2007, when press reports appeared of a feud between Abramovich and manager Mourinho regarding the performance of certain players such as Andriy Shevchenko.
In March 2017, Chelsea announced it had received approval for a revamped £500m stadium at Stamford Bridge with a capacity of up to 60,000. Following the delay in the renewal of Abramovich's British visa by the Home Office, and his subsequent withdrawal of the application, in May 2018 Chelsea halted plans to build a £500m stadium in south-west London due to the "unfavourable investment climate" and the lack of assurances about Abramovich's immigration status. Abramovich was set to invest hundreds of millions of pounds for the construction of the stadium. Abramovich has been accused of purchasing Chelsea at the behest of Vladimir Putin, but he has denied the claim. Putin's People, a book by journalist Catherine Belton, a former Financial Times Moscow correspondent, formerly made such an assertion, but after libel action by Abramovich against Belton and the book's British publisher HarperCollins, the claims were agreed in December 2021 to be stated as having no factual basis in future editions.
In 2021, Abramovich was criticised for trying to enter Chelsea into the newly announced European Super League. The competition was widely scrutinised for encouraging greediness among the richer, larger football clubs, which would have undermined the significance of existing football competitions; however, just two days later, Abramovich pulled the club out of the new competition, with other English clubs following suit, causing the league to suspend operations. In 2022, it was reported that Abramovich was owed $2 billion from Chelsea. According to Forbes, Abramovich's loan was insurance in case the British government considered sanctioning him due to his close relationship with the Putin regime in Russia. On 26 February 2022, during the Russo-Ukrainian War, Abramovich handed over "stewardship and care" of the club to the Chelsea Charitable Foundation.
Abramovich released an official statement on 2 March 2022 confirming that he was selling the club due to the ongoing situation in Ukraine. Although the UK government froze Abramovich's assets in the United Kingdom on 10 March due to his "close ties with Kremlin", it was made clear that the Chelsea club would be allowed to operate in activities which were football related. On 12 March, the Premier League disqualified Abramovich as a director of Chelsea.
On 7 May 2022, Chelsea announced that the investor consortium BlueCo led by Todd Boehly and Clearlake Capital had agreed on the terms to acquire the club.