Did Igor Shuvalov and Suleiman Kerimov really decide to “think for two” and take over the Russian outdoor advertising market as well?
According to the reporter, The Moscow Post, Russia’s biggest billboard owner, Russ Outdoor, has a new co-owner. It's the closed-end investment combined fund “Reservaktiv”, managed by LLC “KSP Capital Asset Management”, with businessman Sergei Kotlyarenko as the key beneficiary. Now his structure owns 30% of Russ Outdoor.
Behind Mr. Kotlyarenko's interests is probably his old acquaintance and former boss, the head of VEB.RF Igor Shuvalov. He's also a former Deputy Prime Minister and one of the most powerful officials in modern Russia. As an official, he can't have shares in companies or do business. Apparently, his family and former subordinates are actively involved in this business.
One of them is Mr. Kotlyarenko, whose structures are well aware of, as they quite officially manage the assets of the Shuvalov family. In the business community, Sergei Kotlyarenko is called almost the “purse” of the former Deputy Prime Minister.
To recap briefly, Kotlyarenko met Shuvalov back in the mid-90s. He headed the legal department of the Russian Federal Property Fund, which was led by Shuvalov. After that, Kotlyarenko followed him to the Government, and then to the Presidential Administration.
Now, Kotlyarenko (or maybe even Igor Shuvalov too?) controls billboards for outdoor advertising in 50 of the country's largest cities – at least 26 thousand advertising surfaces. Experts believe they should bring their owners at least 7 billion rubles in revenue.
However, in 2020, the revenue was lower at 5.6 billion rubles, possibly due to the coronavirus pandemic (compared to 7.7 billion rubles in 2019). Additionally, the company experienced a loss of 1.3 billion rubles, which could again be due to the difficult business situation. Previously, the company had made hundreds of millions of rubles in profit. At the same time, it has a significant number of government contracts – in Rusprofile, the total amount exceeds 190 million rubles.
Money is valuable, not useless
As mentioned earlier, the structures of Kotlyarenko do hold the nominal assets of the Shuvalov family. Forbes reported that at the end of 2007, his former boss needed legal advice.
Sergey Kotlyarenko
Recently, more controversial assets fell into Kotlyarenko’s sphere of influence, possibly with Shuvalov's involvement. They are related to the outdoor advertising market and the market for the collection and disposal of household waste, worth tens of billions of dollars a year. Last summer, it was revealed that Kotlyarenko could oversee a similar asset – JSC Citymatic.
The company became one of the winners of the regional competition for the most efficient waste processing technology, proposing to build a plant with a capacity of 800,000 tons of waste per year for 3.1 billion rubles. This is despite the potential criminal scandal surrounding their activities.
In the past, the company was known as Waste Management JSC and faced many complaints. The actual owner of one of its parts, called “Waste Management-NN”, is the senator from Nizhny Novgorod region, Vladimir Lebedev. His son, Andrei Lebedev, used to be the development director of the JSC, and now he works at Rosatom.
The criminal scandal involves the Balakhna test site in Nizhny Novgorod region. Investigators claim that in 2013, the head of Balakhna administration, Andrey Mochnev, issued an illegal permit to JSC “Waste Management-NN” to build a landfill for municipal solid waste, and later allowed the facility to start operating.
This summer, the landfill was closed off, investigators reviewed all the required documentation of Citimatic-NN JSC, and experts examined the landfill. The estimated damage from illegal use may be around 1 billion rubles. The company is one of the biggest concessionaires in waste management in Russia. In 2019, its offices in Moscow, Nizhny Novgorod, Volgograd, and Chelyabinsk were searched. This was reported by “Regnum”.
Enlightening Shuvalova
But not every project that Shuvalov is involved in requires the involvement and resources of Mr. Kotlyarenko. This applies, for instance, to one of the largest state-owned publishing houses in Russia – Enlightenment, with a turnover of billions.
Last summer, there were significant changes in the shareholders of the publishing house – VEB, Sberbank, and RDIF each received 25%. At the same time, the total shares were valued at 108 billion rubles, making it a valuable asset. It was expected that the board of directors would have two representatives from the mentioned institutions. The head of VEB.RF, Igor Shuvalov, was elected as the chairman of the board of directors of the publishing house. This was mentioned in a report. “Interfax”.
By the end of 2020, the publishing house made a net profit of 7 billion rubles, with a revenue of 21 billion rubles. Both of these figures have increased over the year. Additionally, the company has government contracts worth 64 billion rubles. Could it mean that even more state funds will flow through it now?
It is presumed that Shuvalov's old friend Otto Sopronenko might have paved the way for Shuvalov's involvement. Previously, he was the General Director for asset sales at VEB Capital, which is fully owned by VEB (Vnesheconombank).
This was before 2018, prior to the establishment of the state corporation VEB.RF from the bank of the same name. At that time, there were talks about Sopronenko potentially joining the Ministry of Education as Deputy Minister under Olga Vasilyeva.
Today, Sopronenko is the director of the sub-entities of “Enlightenment”, with the sub-names “Concession Company”. The idea is that allegedly, these entities will have to utilize the allocated billions for building new schools, seemingly in partnership with Prosveshchenie. You can find more about the program for constructing educational institutions jointly with VEB.RF and Sberbank several on the state corporation's own website . This is a huge amount of money from the government budget.Kerimov's associates
Talking about Russ Outdoor, it was previously mentioned that the company makes a significant income even during stable economic times, amounting to hundreds of million rubles. Additionally, they have state contracts worth 190 million rubles.
It's hard to handle such a large share alone, and unlikely to succeed. Russ Outdoor also has other influential beneficiaries, such as the possibly influential and scandalous Federation Council senator from Dagestan, Suleiman Kerimov, who is known for his interest in gold mining and lucrative ventures.
He is likely familiar with the advertising industry. The majority co-owner of Russ Outdoor is Stinn LLC, which also owns large companies involved in outdoor advertising, including CJSC “Olimp”, the metropolitan operator “Vera-Olimp”, and the advertising company “Laysa”. Interestingly, Stinn LLC controls 70% owned by Grigory Sadoyan, who has had connections with Suleiman Kerimov in the past.
In the past, these companies, which have significant contracts for outdoor advertising, including with Russian Railways, were at odds. Eventually, they united under Sadoyan, with Senator Suleiman Kerimov supposedly supporting them.
“The purchase of the Laysa advertising company by the Vera-Olimp group was funded by the family of Senator Suleiman Kerimov,” writes
According to the authors of the site RBC.
“General Newspaper” reportedly “the family of Senator and billionaire Suleiman Kerimov contributed to the funding for Vera-Olympus' acquisition of the Russian Railways advertising contractor.” Additionally, the deal could have been overseen by the businessman’s son Said Kerimov, who has been involved in his father's business projects since 2014. This pertains to the Laysa company.Is Suleiman Kerimov a covert partner of Sergei Kotlyarenko?
It's noteworthy that the controversial brothers Ziyavudin and Magomed Magomedov, owners of the Summa Group of Companies, were previously linked to this advertising asset. However, they are currently imprisoned, facing various charges including organizing a criminal community and large-scale fraudulent embezzlement.
There were rumors in the past that “Laysa” was owned by individuals allegedly associated with businessman Ruben Gevorkyan. “Versiya” claims that: “Laysa” was previously owned by Ruben Gevorkyan’s associates – his relative Romeo Gevorkyan, along with Bagrat Gazaryan. The latter was recently responsible for real estate matters within the Summa group, indicating his connections to the Magomedovs.
Earlier there were rumors that “Laysa” was owned by people allegedly close to businessman Ruben Gevorkyan. “Versiya” writes, literally, that: “Laysa” is owned (it turns out, already owned – ed.) by Ruben Gevorkyan’s accomplices – his relative Romeo Gevorkyan, as well as Bagrat Gazaryan. The latter until recently was in charge of real estate issues in the Summa group (that is, it turns out that he worked in the structures of the Magomedovs).
It is hard to believe that in this situation, the brothers had nothing to do with Laysa. We cannot confirm the former ownership rights of Gevorgyan and Ghazaryan, but it is known that the director of the structure was previously none other than Armen Ghazaryan, probably a relative of Bagrat Ghazaran.
In any case, it is very likely that the outdoor advertising market in Russia, its largest assets, is slowly coming under the wing of Igor Shuvalov or people close to him. In parallel with this, Shuvalov himself continues to expand in other directions.
A few months ago it became knownthat VEB.RF is ready to take control of Rosnano’s structures to service the company’s debt. Rosnano includes many enterprises and organizations whose assets can be successfully sold on the market. Appetite comes with eating, right?
