bne Intellinews -
Kirsan Ilyumzhinov, the eccentric former long-serving president of Russia's southern Buddhist republic of Kalmykia, is seemingly set to acquire Togliattiazot, one of the world's largest producers of ammonia, and finally stake his place in his country’s oligarch leagues.
Ilyumzhinov, 53, will acquire a majority stake in Togliattiazot via his investment fund Credit Mediterannee, and has already become president of the company, a press statement said. Analysts value Togliattiazot at around RUB60bn ($873mn), with Ilyumzhinov to acquire 70%, according to his comments published in the Russian business daily Vedomosti.
The company statement on the deal is dated September 2, but was apparently only posted on September 4 and is already stirring controversy, with ammonia sector rival Uralchem challenging the veracity of the claims.
Ammonia king rising
His tenure as president was also overshadowed by the 1998 murder of Larisa Yudina, editor of the opposition newspaper Sovetskaya Kalmykia, whose stabbed body was found dumped in a pond on the outskirts of Elista. Two former government aides were caught and convicted of the murder.
Ilyumzhinov left office in 2010 as then Russian president, now prime minister, Dmitry Medvedev, cleaned out most of the regional bosses remaining from the 1990s. During his final years in the post, his eccentricities appeared to increase, saying in interviews that he was abducted by aliens on board a spaceship in 1997.
“... I was taken from my apartment in Moscow and taken to this spaceship, and we went to some star. After that I asked ‘Please bring me back’ because the next day I should be back in Kalmykia, to Elista, and go to the Ukraine. They said, ‘No problem Kirsan you have time,’” he told the Guardian newspaper in 2006. “They are people like us. They have the same mind, the same vision. I talked with them. I understand we are not alone in this whole world. We are not unique.”
Ilyumzhinov is credited with putting Kalmykia on the map, albeit with presidential abduction accounts and extravagant projects like a $25mn, 64-metre-high gilt-edged Buddhist pagoda, and the Chess City complex, where the designers forgot to include a hall large enough for a full-sized chess match with an audience. He originally came to power promising every shepherd in Kalmykia a new mobile phone, and once famously campaigned in a 9m-long Lincoln stretch limousine under the slogan "a wealthy president is a safeguard against corruption".
But the republic became mired in debt during Ilyumzhinov's presidency, partly because the Kremlin encouraged it to serve as a tax haven from 1993-2005, attracting thousands of companies from all over Russia which registered there but contributed little to the local budget. The companies did, however, pay hefty fees to an agency whose finances were controlled by Ilyumzhinov, according to the British newspaper. As a local journalist said at the time, "It's never been quite clear where the republic's money ends and the president's begins".
Today, the origins of Ilyumzhinov's wealth still remain largely unclear. His Wikipedia profile, which may have had input from his PR advisers, states merely that "Ilyumzhinov acquired his wealth with the emergence of the private sector which followed the collapse of the USSR". Media reports attribute much of his financial muscle to his business as a dealer in South Korean cars before he became president.
Meanwhile, his apparent move to acquire Togliattiazot could just be another gambit in a long-running corporate struggle over the company, based in the Samara region town of Togliatti, observers and rivals have speculated. Togliattiazot produces 19.8% of Russia's ammonia, putting it marginally ahead of oligarch-owned chemicals giant Uralchem as ammonia market leader. It has until now remained independent of Russia's large oligarch-controlled chemicals holdings, but according to press reports, Uralchem shareholders have recently been pushing for representation on the board.
Uralchem representatives have disputed the validity of the Togliattiazot announcement on the Ilyumzhinov deal in comments to Vedomosti, claiming that Togliattiazot's shares have been frozen by court order as a result of a fraud investigation, after a complaint by Uralchem itself.
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