July 22, 2024

Russian oligarch Roman Abramovich has acted as an intermediary in the transfer of the most important assets for Russian television from the entourage of the Yeltsin family to Putin‘s friends (Boris Yeltsin was the first Russian President, ruling in 1991-1999 – ed.).

Source: Russian outlet Vazhnye Istorii, with reference to documents that became available due to the leak of corporate papers of Cypriot law firms

The newspaper received these documents by participating in the international investigative project Cyprus Confidential.

Cyprus Confidential is a global investigation based on the leak of 3.6 million documents of six Cypriot companies engaged in firm registration and consulting. It was held by 270 journalists from 69 media outlets under the auspices of the International Consortium of Investigative Journalists (ICIJ) and the German Paper Trail Media.

Vazhnye Istorii recalls that after Putin came to power in 2000, he needed control over the media, primarily over TV channels.

Quote: “Roman Abramovich played the role of an intermediary during the transfer of the most important assets for Russian television from people close to the family of former Russian President Boris Yeltsin to friends of the new President Putin. This was the case not only with First Channel (which was then called ORT), but also, as it turned out, with the largest seller of television advertising in the country at that time – the Video International group.

According to the documents that became available due to the leak of corporate papers of Cypriot law firms, Abramovich bought a quarter of the Video International group back in 2003, and in 2010, he sold a share to the companies of Putin’s friend – cellist Sergey Roldugin, who is considered the wallet of the Russian President,” the article says.

According to Vazhnye Istorii, until now it was believed that friends and associates of Mikhail Lesin, Russia’s former Minister of Press, Broadcasting and Media – a person close to Yeltsin’s family – sold Video International in 2010 to Rossiya Bank entities owned by Yuri Kovalchuk, an old friend of Putin’s.

However, documents from the Cyprus leak indicate that back in 2003, Yuri Zapol, the founder and president of Video International, a friend of Lesin, who owned 41.5% of Video International, sold 25% to the entities owned by Abramovich.

Quote: “The deal was strange because it was not a sale, rather a display of unprecedented generosity – according to the documents, Abramovich got 25% of the Video International group for only RUB 8 million (about US$270,000). And the following year, this package brought him US$1.8 million in dividends, that is, almost seven times more than what was paid,” the investigation says.

Meanwhile, Abramovich’s involvement in deals with Video International was not previously known. Abramovich did not respond to questions from ICIJ, the BBC and Vazhnye Istorii about the deal.

Leaked documents show that on 10 September 2003, Zapol signed two contracts: 12.5% of Video International was sold to the Cypriot companies Finoto Holdings and Grosora Holdings. Both were “locked” to offshore companies owned by Abramovich’s Sara Trust.

In 2010, it was revealed that Video International had been sold to the structures of Yury Kovalchuk and businessmen close to him. The sale was preceded by a campaign to reduce the price of the asset: a special law was passed limiting the share of the seller’s share of TV advertising in the market to 35%.

Quote: “It was directly aimed at Video International, with a share that was twice as large. But after selling the group into the right hands, it turned out that the law was not so terrible in fact – Video International did not have to give up its customers, it simply transferred part of the TV channels to the “consulting” mode. And in 2014, Putin completely cancelled this threshold of advertising dominance on television,” the newspaper reports.

Documents from the Cyprus leak show that in December 2010, Cypriot firms Finoto Holdings and Grosora Holdings sold 25% of the Video International group for US$40 million.  The buyers were Med Media Network and Namiral Trading, the Cypriot companies related to cellist Sergey Roldugin, the godfather of Putin’s daughter, and his old friend.

The owner of Med Media Network was his Panamanian firm called International Media Overseas, listed in the international journalistic investigation Panama Papers. And the owner of Namiral Trading was Alksandr Plekhov, an entrepreneur close to Yury Kovalchuk, the founder of Rossiya Bank. In some cases, Plekhov acted on behalf of Roldugin.

Roldugin is often called “Putin’s wallet”. He gained such a reputation after the release of the Panama Papers international investigation, from which it became clear that Putin’s friend, not being a businessman, is listed as the owner of several offshore companies through which billions of US dollars pass. Moreover, many agreements make no obvious economic sense, other than creating a formal excuse to transfer money to these offshore companies.

Roldugin and Kovalchuk did not answer journalists’ questions for this investigation.

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