Tag: Billionaires

Forbes Billionaires and the Global Economy

On Mar 09 2011

Image via Wikipedia

This is the eighth year I have worked on Forbes’ World’s Billionaires. As always, I find the personal tales fascinating. I met with new Ukrainian billionaire Yuri Kosiuk at the Four Seasons in New York last fall when he was pitching Wall Street for investment dollars for his poultry producer. We had coffee and a long chat about how his business is faring in Ukraine’s often fraught political environment. His take: if you know how to play the game you can succeed. We heard the same from Aliko Dangote, the Nigerian billionaire who increased his fortune six-fold when he took his cement operations public. He is convinced he can maneuver the politics in Africa to build a continental (and global) cement giant.

On a macro level, the total net worth and number of billionaires says a great deal about how a country is doing. My thesis: in Ukraine and Russia, a disproportionate amount of wealth looks to be accumulated in a few hands, the relic of a centralized Soviet system (in Kazakhstan we don’t see the same because the state still controls many assets under the tight grip of President Nursultan Nazarbaev) (Caveat: some of the wealth is held in investments in other countries but I think my thesis holds true for the most part). Meanwhile, in Eastern Europe, though central planning was also instituted, the political systems and opposition to communism emerged differently and there appears to be more spreading of wealth and perhaps the opportunity to still amass wealth. (see stats below) Indeed, Poland’s robust stock exchange has regional players flocking to go public. Poland is serving as a model for wealth creation.

We can also see where money is coming from – US’ biggest billionaire names come from tech, investments/finance and retail – think Bill Gates, Warren Buffet and Waltons of Wal-Mart whereas Western Europe is all about luxury brands like LVMH’s Bernard Arnault or Tod’s Diego Della Valle. In Eastern Europe, we see finance as a leader, and agribusiness. In the CIS, commodities dominate, though agribusiness is growing.

Total 2011 Billionaires Net Worth: $1.3 trillion
GDP 2011 forecast (World Bank): $15.3 trillion
8% of country’s GDP
Total 2011 Billionaires: 412
Total Population: 315 million

Russia

Total 2011 Billionaires Net Worth: $432.7 billion
GDP 2011 forecast (World Bank): $1.6 trillion
27% of country’s GDP
Total 2011 Billionaires: 101
Population: 140 million

Ukraine

Total 2011 Billionaires Net Worth: $30.3 billion
GDP 2011 forecast (World Bank): $165 billion
18% of country’s GDP
Total 2011 Billionaires: 8
Population: 45 million

Kazakhstan

Total 2011 Billionaires Net Worth: $12 billion
GDP 2011 forecast (World Bank): $144 billion
8% of country’s GDP
Total 2011 Billionaires: 5
Population: 15.6 million

Poland

Total 2011 Billionaires Net Worth: $8.9 billion
GDP 2011 forecast (World Bank): $472 billion
2% of country’s GDP
Total 2011 Billionaires: 4
Population: 38 million

Czech Republic

Total 2011 Billionaires Net Worth: $12.3 billion
GDP 2011 forecast (World Bank): $185 billion
6% of country’s GDP
Total 2011 Billionaires: 3
Population: 10 million

Romania

Total 2011 Billionaires Net Worth: $3.3 billion
GDP 2011 forecast (World Bank): $163 billion
2% of country’s GDP
Total 2011 Billionaires: 2
Population: 21 million

Nigeria

Total 2011 Billionaires Net Worth: $15.8 billion
GDP 2011 forecast (World Bank): $230 billion
GDP/NW: 7% of country’s GDP
Total 2011 Billionaires: 2
Population: 160 million

Gold Tussle: Russia vs. Kazakhstan

By admin

On Jul 13 2010

In Billionaires

Plans by the owners of Russia’s top gold producer, Polyus Gold, including Russian billionaires, Mikhail Prokhorov and Suleiman Kerimov, may be thwarted in their efforts to buy Kazakh gold miner KazakhGold Group.

The Kazakh government this week annulled a merger of the two evoking the 2007 Subsoil Law which allows the government to annul any contract involving the use of subsoil resources in the country if it is of national strategic importance the government. The government is reportedly concerned over a low deal price.

If the deal were to go ahead, the merged company – to be called Polyus Gold International Limited – is expected to become one the world’s leading gold mining companies, whose shares will trade on the London Stock Exchange as a single company. (Polyus Gold plans to delist its ADRs from the LSE.)

Event timeline:

*December 2008, Polyus Gold announced first offer for stake in KazakhGold; estimated above $700 million

*April 2009, negotiations announced to adjust offer. In a statement KazakhGold wrote, the “Company’s production levels and working capital levels have deteriorated substantially more rapidly than previously anticipated and KazakhGold requires a funding commitment, in order to continue to operate as a going concern in its current form. Due to these wholly exceptional circumstances, the terms of the Proposed Partial Offer as announced on 29 December 2008 are no longer valid, however, KazakhGold and Polyus Gold remain in active negotiations to agree revised terms in respect of the Proposed Partial Offer.”

The price was adjusted down about 60%.

*July 2009: Polyus Gold, through its indirect wholly-owned subsidiary, Jenington International Inc. (“Jenington”), made a recommended partial offer to acquire 50.1% of the issued and to be issued share capital of KazakhGold. The Partial Offer was declared unconditional on 14 August 2009.

*June 25, 2010: KazakhGold Group Limited (“KazakhGold”); its wholly-owned subsidiary, KAZAKHALTYN MMC JSC (“Kazakhaltyn”); and Jenington International Inc., a wholly-owned subsidiary of OJSC Polyus Gold (“Jenington”); commenced proceedings in the High Court of Justice (Chancery Division) in London against five members of the Assaubayev family who were former directors of KazakhGold; Gold Lion Holdings Limited (“Gold Lion”) and Hawkinson Capital Inc., (“Hawkinson”). Gold Lion was, prior to completion of the Partial Offer by Jenington to acquire 50.1% of the issued share capital of KazakhGold in August 2009, the principal shareholder of KazakhGold. The defendants include Kanat Assaubayev, who was Executive Chairman of KazakhGold until the completion of the Partial Offer, and Aidar Assaubayev, the former Executive Vice Chairman, who continued as a director until his appointment was terminated on 17 June 2010.

*June 30, 2010, KazakhGold and Polyus Gold, which owns 50.1% in KazakhGold via its subsidiary Jenington International Inc, announced a reverse merger, under which KazakhGold would acquire its parent company Polyus Gold. Under the scheme, one share of Polyus Gold will equal 9.26 Global Depositary Receipts of KazakhGold, and one American Depositary Receipt of Polyus Gold will equal 4.885 GDRs of its subsidiary.