Tag: Kazakhstan

Forbes Billionaires and the Global Economy

On Mar 09 2011

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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

Other Power Women – A View from Eurasia

By admin

On Oct 08 2010

In Analysis

: Image via Wikipedia

I was recently a reporter on the Forbes Power Women list; indeed I have been working on the list since its inception five or so years ago. This year, the list is a bit different; glammed up to be sure.

If I would be able to add to the list, I’d definitely look at some players from Eastern Europe and Central Asia making the list a more global. (in no particular order):

*Roza Otunbayeva – Kyrgyzstan’s parliamentary elections are scheduled for this weekend with over 3,000 candidates running for office. Otunbayeva has had a huge role in making this happen. Her interim government took over after the April ouster of former dictator, Kurmanbek Bakiyev. She removed restrictions on independent media and helped ratify a new constitution in June despite ethnic violence that erupted that month. She will lead the country as president until 2011. The mineral rich nation may offer an alternative to China’s dominance in rare earth metals; Otunbayeva will play a large role in developing mining and other economic policies.

*Yulia Tymoshenko – Don’t dismiss the former (two-time) Ukrainian prime minister and one-time presidential candidate. Now leading the opposition, Yulia continues to be a thorn on the side of the current Yanokovych government insisting Ukraine maintain ties with the West.

*Dinara Kulibaeva – Daughter of Kazakhstan’s president for life, Nursultan Nazarbaev, is a billionaire through her holdings in Halyk bank and married to a potential future leader of Kazakhstan, Timur Kulibaev. Though nothing is certain because Nazarbaev keeps his succession close to his chest, clearly Dinara and Timur will remain among the nation’s future power elite.

*Mounissa Chodieva – Daughter of Kazakhstan billionaire, Patokh Chodiev, Mounissa has previously been dubbed by UK papers as Britain’s “first female oligarch.” She and her father, as well as other partners, minted money when Eurasian Natural Resources went public. As head of the company’s investor relations team, Mounissa is heavily invested in managing the company’s image and messaging. I worked with Mounissa several years ago when I wrote a profile of the company prior to IPO and can attest she will continue to be a mover and shaker.

Grazyna Kulczyk – One of Poland’s richest women is know for her support of the arts and for taking Poland up a notch in the contemporary art world. Since 2007, part of her collection has been shown in her redbrick shopping mall, the Stary Browar, a Prussian-era brewery. She also invested in a new conceptual hotel, Blow Up 5050 – both a luxury hostelry and an electronic-art installation.

Kyrgyzstan parties negotiate to form region’s first parliamentary democracy (theglobeandmail.com)

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.

Only 2 Women Billionaires in Eastern Europe, Russia and rest of CIS

By admin

On Mar 15 2010

In Analysis

Where are all the women? We’re Half the Sky as but we’re always underrepresented as Catalyst reasearch points out (see my previous post titled International Women’s Day). The same is true for Eastern Europe, Russia and the rest of the CIS where only 2 women reached Forbes billionaire ranks out of some 40 or so total women on the 1,011 long list.

The richest in the region is Elena Baturina who returned to the list after a rebound in Russia; her net worth: $2.9 billion. The wife of Moscow Mayor Yuri Luzhkov (who has been in power since 1992) runs Inteko which started out in furniture and crockery then moved into construction. Her real estate projects were hard hit by the 2008 financial crisis but she is back building affordable housing for Russia’s rising middle class. She also reportedly has interests in Africa, a continent where several CIS oligarchs are looking to expand. Though rumors swirl about favoritism in winning city contracts because of her family connections, nothing sticks; Baturina is aggressive about maintaining a clean reputation.

The other is Dinara Kulibaeva, the media-shy second daughter of Kazakhstan’s long-serving president Nursultan Nazarbaev and wife of Timur Kulibaev, also a billionaire and rumored to be a potential successor to Nazarbaev. She also returns to the Forbes billionaires list; her fortune is estimated at $1.1 billion resting on her shared stake in Halyk Bank which received hundreds of millions of dollars in bailout funds from the government post 2008/2009 financial crisis.

The common thread between the two is the connection to powerful men. Though the Soviet State introduced equal gender rights and formal equality under law and this should have been grandfathered into newly independent states, the theory has not always played out in practice. Some states in Central Asia (Tajikistan and Uzbekistan) have even taken steps backward since the 1991 dissolution of the Soviet Union with discrimination against women rising.

More Billionaires in Eastern Europe, Russia and rest of CIS says Forbes

By admin

On Mar 10 2010

In Analysis

2009 was a year of recovery for the World’s Billionaires as a whole reports Forbes (for whom I have been freelancing). The wealthiest in Eastern Europe, Russia and the CIS states improved their fortunes as commodities markets recovered and world stock markets rose.

Poland, a success story among transition economies, but which had only 1 billionaire on the list last year, Zygmunt Solorz-Zak, is back with 4 billionaires. In addition to Solorz-Zak, Jan Kulczyk, Leszek Czarnecki and Michal Solowow return to the Forbes billionaires list. Kulczyk, who was last on the Forbes list in 2006, is strengthened by his energy holdings.

Dinu Patriciu, Romania’s richest billionaire, is also making a big push in energy, going after licenses to explore for oil and metals in the Black Sea; in January he even got patent for a method of mining and processing seabed sediment.

Despite the fact Romania’s GDP contracted an estimated 7% in 2009 and its hopes to introduce the euro by 2014 may be thwarted by collapsing euro-economies like Greece, the country saw the return of former tennis ace, Ion Tiriac, to the Forbes billionaires list and added one new billionaire, Ioan Niculae, who has interests in agriculture.

Indeed it was a good year for agriculture – the world’s rising population needs to be fed. Andrej Babis joined the Forbes list as a new billionaire from the Czech Republic; his Agrofert agricultural holding company keeps growing and may be looking at European expansion plans. Along the same theme, two new Russian billionaires, Andrei Guriev, and Anatoly Lomakin, made their fortune in fertilizers; and fellow Russians Pyotr Kondrashev and Vyacheslav Kantor return to the billionaires list based on their interests in the fertilizer business.

Tag: Kazakhstan

Forbes Billionaires and the Global Economy

Other Power Women – A View from Eurasia

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