Home money The oligarch supposed to save the Tui

The oligarch supposed to save the Tui

by drbyos
Tui Group

Major shareholder Mordashov wants to significantly expand his stake.


(Photo: dpa)

Berlin During Alexei Mordashov at the general meeting of the travel company Tui wants to expand his dominant position on Tuesday, the steel magnate privately relies on luxury yachts instead of cruises: his new ship “Nord” from the Bremen Lürssen shipyard is 142 meters long and, according to expert estimates, 300 to 500 million dollars. This was reported by the Russian edition of Forbes magazine at the end of 2020.

Mordashov, who previously played the role of the humble oligarch and formulated sentences like “I can’t wear two suits at the same time”, is now moving up into the class of Russian jet set oligarchs. Even if his yacht with a helicopter garage is a good 20 meters shorter than the “Eclipse” Roman Abramowitsch, former owner of the oil company Sibneft and owner of the London football club FC Chelsea.

Born in the northern Russian steel town of Cherepovets, Mordashov has been a shareholder in Tui since 2007, and his investment vehicle Unifirm Ltd. holds the largest share of Europe’s travel market leader at 24.9 percent to date. At the extraordinary general meeting this Tuesday, a capital increase of 500 million euros is to be resolved. The share of Mordashov’s Unifirm registered in Cyprus in the ailing group would then rise to at least 29.9 percent.

Since the financial supervisory authority exempted Bafin Mordaschow on Monday from a mandatory offer to the other Tui shareholders, which would normally be due if the 30 percent threshold was exceeded, he may even increase his stake to up to 36 percent. The Russian made the exemption a condition that he would subscribe to new Tui shares for up to 266 million euros in the upcoming capital increase. Otherwise it would have been limited to a maximum of 29.9 percent.

The Mordashov family, father Alexej, has already handed over company shares and parts of his assets to two of his six children, confirmed to the Handelsblatt that they would participate in the capital increase. “As a long-term strategic investor at Tui, I am confident that the business model will remain unchanged and that the company’s medium to long-term prospects are good,” said Mordashov.

Tui had slipped into a deep crisis because of the corona pandemic and the massive decline in tourism. The group could only be saved from collapse with billions from the federally owned credit institution for reconstruction and the further capital increase that took place on Tuesday, as well as new state aid. In the fiscal year that ended in September, there was an operating loss of around three billion euros.

At a conference in Moscow, Mordashov had recently described his foreign engagements, which were largely completed except for Tui, as “a sea of ​​mistakes”. He joined the travel company in 2007 – after the merger of his steel company Severstal with the Luxembourg-based steel maker Arcelor had been thwarted by a higher bid from the Indian Mittal Group.

He still believes in the group: “Tui will return to sustainable growth in the near future and maintain its leading position in the dynamic travel market,” said Mordashov. Above all, he sees the change from sole travel sales to the development of “unique travel products” and the digital transformation of the company with its own network of hotels, cruise ships and airlines. Tui will be able to maintain its leading position in the travel market.

Transfer of property to the sons

The business magazine “Forbes”, which specializes in money rankings, lists him as the fourth richest Russian with a fortune of 23.7 billion dollars. The fluent German-speaking oligarch has already transferred parts of his Tui investment and 65 percent of his 98.4 percent stake in the precious metal miner Nordgold to his sons of age, Kirill and Nikita.

“140,000 people work in my company, and I am responsible for them,” says the entrepreneur. He has to “ensure stability, even after inheriting”. Therefore, his two sons would take on responsibility in a new family fund and practically train for later. Ilja, his eldest son from his first marriage, has come away empty-handed after his then wife Elena had him with a war of roses from 2001 to the European Court of Human Rights and had his shares seized at times.

At the beginning of privatization in Russia in the early 1990s, the once best student in his school got hold of the 77 percent stake in the Severstal steelmaker in his hometown through a trick. At the age of 27, Mordashov, who had previously been registered as a member of the Communist Party, bought a majority in the previous state-owned company behind the back of the then general director for his own account.

Alexei Mordashov

The entrepreneur made a fortune in the 1990s.

(Photo: wikipedia)

There is also a dispute with Siemens Energy the future production of large turbines in Russia. A spokesman for the Munich group confirmed this to the Handelsblatt. According to information from the Handelsblatt, the conflict was said to have threatened that Mordashov’s plant manufacturer “Silowyje Maschiny” would oust the Germans from production in Russia – while Siemens had sought to get the majority in a joint venture.

But Mordashov, who is also Vice President of the German-Russian Chamber of Commerce Abroad (AHK), has an excellent reputation, especially among German entrepreneurs: Heinrich Weiss, long-time chairman of the board and supervisory board of the smelter and steel plant manufacturer SMS Group, had offered Mordashov this post. “I have known him as an important customer for many years, and in Russia you have to build good contacts from owner to owner and create a basis of trust,” the former BDI boss told Handelsblatt.

Mordashov was “one of the oligarchs I knew and he was the most polyglot”. In addition, he had not only thought of his steelworks, but also “oriented himself internationally at an early stage”, said Weiss about Mordaschow. Klaus Mangold, once head of the Eastern Committee of the German Economy, also considers Mordashov to be a “great entrepreneur with long-term prospects”. He is “a solid rock whenever it comes to a commitment to German-Russian economic relations”. And Mordaschow’s Tui-Investment calls the 2019 supervisory board chairman of the tourism group “excellent and extraordinary”.

“As with Amazon”

This could be said in any case about Mordashov’s economic success: While the Russian share index lost a good ten percent last year, the papers of his Severstal Group rose by a good 40 percent despite the corona crisis. In addition to steel, coal, ore, gold and birch wood, Mordaschows Holding is also invested in the Russian supermarket chain Lenta, the online retailer Utkonos and in companies from the health and education sectors. He wants to use this to build an ecosystem “of the Amazon type,” emphasizes Mordashov.

Mordashov, who always flirted with the fact that he was less exposed than his fellow billionaires in his dissolute lifestyle, is nonetheless a classic oligarch – an entrepreneur who is affiliated with the political leadership of the country and supports the Kremlin in the media. He also owns shares in the scandal bank “Rossija”, which is placed by closest friends of President Vladimir Putin and is subject to Western sanctions; as well as participation in the National Media Group together with a childhood friend of the Kremlin chief. Only one of the largest yachts in the world was missing until recently.

More: Flex tariff for package tours – this is how the industry wants to get back on its feet.

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