November 1, 2011 / 2:54 PM / 6 years ago

Russian oligarch admits he leads an "extravagant" life

<p>Russian billionaire and owner of Chelsea football club Roman Abramovich leaves a division of the High Court during a break for lunch in central London October 31, 2011. REUTERS/Andrew Winning</p>

LONDON (Reuters) - Billionaire Roman Abramovich was forced to swallow his words in a London court Tuesday, when details of his luxury lifestyle undermined his declaration that he never wanted to imitate the extravagances of rival Russian oligarch Boris Berezovsky.

The pair are locked in a $6 billion legal battle in London’s Commercial Court, with Berezovsky accusing his former protege of intimidating him in 2000 into selling shares in oil company Sibneft at a fraction of their value.

Abramovich, 45, denies that Berezovsky ever had an interest in the company.

The court heard about Abromovich’s plush properties and holidays, drawing laughter after the Chelsea soccer club owner wrote in his witness statement that in 1994 he was surprised by Berezovsky’s “extravagant lifestyle,” adding: “I was never interested in imitating his lifestyle.”

When quizzed by Berezovsky’s lawyer, Abramovich agreed that he had bought a 420-acre estate in England, an expensive flat in an exclusive central London area and a chateau in France which once belonged to the Duke of Windsor, as Britain’s King Edward VIII was known after his abdication in 1936.

“You now want to qualify that, do you, to say, whilst you weren’t interested in an extravagant lifestyle then, you may have an extravagant lifestyle now?” asked the lawyer, Laurence Rabinowitz.

Abramovich agreed, speaking in Russian via an interpreter in a courtroom packed with bodyguards and banks of lawyers and aides.

The list of Abramovich’s skiing holidays in the luxury resort of Courchevel and in Megeve, both in the French Alps, and yachting cruises in the Caribbean are some of the latest glimpses into the luxury lives of the Russian-born tycoons.

Abramovich -- whose fortune is estimated at over 10 billion pounds ($16 billion) -- also wrote in a witness statement: “I travelled with my family and my personal assistant ... by helicopter to Megeve.”

The case, which started in early October, is being followed closely by Russia watchers from London and Moscow for any new clues into the murky world of Russian business and politics.

The two men were close when making their fortunes in Russia in the 1990s when a small group of businessmen snapped up shares in former state firms sold off after the collapse of the Soviet Union. They fell out a decade ago.

FRIEND AND FOE

Once a close ally of former Russian president Boris Yeltsin, Berezovsky, 65, fled to Britain in 2001 after a dispute with Yeltsin’s successor Vladimir Putin. Criminal charges were brought against Berezovsky in Russia over his business dealings.

In contrast, Abramovich has remained in favor with Russia’s leaders. He used his billions to revive the remote Arctic region of Chukotka during his 2000-2008 stint as governor, coinciding with Putin’s presidency. He also sold Sibneft to state-controlled gas giant Gazprom for more than $13 billion, where it now forms the basis of the company’s oil arm.

Abramovich’s relationship with Berezovsky began in late 1994 when he wanted to create what later became Sibneft, he wrote in his witness statement.

To achieve this in the chaotic 1990s Russia, he required the help of a politically connected person and, as a potentially successful businessman, protection from criminal gangs, an arrangement known in Russian as “krysha” or “roof,” he wrote.

“Mr Berezovsky provided me with political support in the second half of the ‘90s and ... physical protection in relation to the creation of Sibneft. In return, Mr Berezovsky expected substantial cash payments from me,” Abramovich wrote.

“Mr Berezovsky’s demands were not tied to any notion of a ‘share of profits’ -- be it of Sibneft or any other company.”

By 2000, when Putin became Russia’s president, Abramovich’s business relationship with Berezovsky was over, he wrote. “His time had passed. His period in Russia’s post-communist history was over ... Yet he still treated me as his ‘cash cow’ and expected me to fund all his expenses.”

In 2001 the two oligarchs decided to end their common dealings in relation to Sibneft and agreed that Abramovich would pay Berezovsky and his associate a final sum of $1.3 billion, Abramovich wrote. He saw this as “buying myself my freedom” from any association with Berezovsky and their “krysha” relationship.

Abramovich began giving evidence Monday in hearings that have been complicated by misunderstandings arising from the need to translate Rabinowitz’s questions, and which highlight some of the difficulties of pursuing the many cases brought by Russians in English courts.

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below