Aluminum King to fit new armor? 

Aluminum King to fit new armor?
Photo: The CrimeRussia

The American sanctions hit hard at the business of Russian ‘Aluminum King’. Oleg Deripaska is forced to get rid of his assets. The billionaire sold a share in his construction business to Yuri Chechikhin, son-in-law of the National Guard Director. Two decades ago, Deripaska had already used a similar strategy by marrying Polina Yumasheva, daughter of Boris Yeltsin’s son-in-law. The beneficial matrimony enabled the businessman to lay hands on the domestic aluminum industry. What are the potential benefits from the alliance with National Guard Director’s clan? How much is the enforcement functionary going to get in exchange for his huge administrative resource?

On July 4, 2018, the shareholders’ structure of Rosstroyinvest Limited Liability Company, a construction subdivision of Basic Element Group belonging to Oleg Deripaska, has changed. Yuri Chechikhin became the owner of 9% of its shares.

The remaining 91% of shares still belong to Fakel (Torch) Limited Liability Company (0.1%) and Fenestraria Consultants Limited (90.9%) incorporated in Cyprus and belonging to Deripaska.

Rosstroyinvest Limited Liability Company is the sole founder of Glavstroy-SPb Limited Liability Company. This subsidiary company is currently building Stolichny Residential Complex in the Moscow region and three residential complexes in St. Petersburg: Yuntolovo, Severnaya Dolina (Northern Dale), and Panorama 360. According to the Consolidated Residential Construction Information System, currently Glavstroy-SPb Limited Liability Company has construction permits to build 521 thousand square meters of living space. Based on the current land and housing prices, Andrei Kosarev, General Director of the St. Petersburg Branch of Colliers International, estimates the value of the 9% of shares in Rosstroyinvest at some 4 billion rubles ($64.4 million) excluding the debts.


Oleg Deripaska

Why has Deripaska sold a portion of a profitable asset? The main reason, of course, are the sanctions imposed by the US Department of the Treasury in April 2018. The restrictions affect both Deripaska personally and En+ Group belonging to him and controlling portfolios of shares in RUSAL, Basic Element, etc. The Aluminum King lost $2.85 billion on the day of the sanctions announcement and had to reduce his share in En+ below 50% by the end of April. In May, he had to resign from the Boards of Directors of En+ and RUSAL. In response, the US Department of the Treasury has mitigated the sanctions by extending the deadlines for ceasing all relations with the companies affected by the new sanctions for American individuals and legal entities.

The American authorities deem it possible to completely lift the sanctions if Deripaska ceases to control all the companies put on the sanction list.

To take the heat off his assets, the Russian billionaire continues selling those out. On July 6, two days after the sale of the portfolio in Rosstroyinvest, it became known that Deripaska successfully meets the new challenge.

This year, Aluminum King is not listed in the Bloomberg’s “World’s 500 Richest People ” – although in 2017, the Russian billionaire was at the 187th position in this rating.

But it is not sufficient to cease being the official owner of the assets – it is necessary to understand how to make the business profitable in the new reality. After the imposition of sanctions, the Russian authorities had promised to provide comprehensive support to Deripaska. The Government had planned to increase the state acquisitions of goods produced by the sanctioned enterprises, while nationalization of a portion of his business was under consideration. However, in late June, it became known that all the proposals have been rejected because “the terms of the assistance were enslaving”.


Apparently, Deripaska has chosen another tried and tested scenario as the defense strategy. In 2001, future Aluminum King has got huge administrative resource by marrying Polina Yumasheva, daughter of Valentin Yumashev, husband of Boris Yeltsin's daughter. The beneficial matrimony enabled the businessman to lay hands on the domestic aluminum industry.


Oleg Deripaska and Polina Yumasheva

Now the billionaire is looking for new ‘patrons’ in the President’s circle of close associates. As of today, one of the most powerful figures in the country is Viktor Zolotov, personal guard of Vladimir Putin, Director of the National Guard of Russia, and member of the Security Council. By selling a portfolio of shares in Rosstroyinvest to Yuri Chechikhin, Deripaska gets access to the enormous administrative resource of clan Zolotov: according to the Anti-corruption Foundation, the new partner of Deripaska is the husband of National Guard Director’s daughter Zhanna Zolotova.


Zhanna Zolotova and Yuri Chechikhin

Chechikhin does not have much experience in the construction business. The 41-year-old son-in-law of Viktor Zolotov has graduated from the Faculty of Economy, Law, and Management of Gubkin Russian State University of Oil and Gas in 1998 and from the Financial Academy with a major in Finance and Credit – in 2004. Then he decided to switch to the media and marketing sphere. Up until 2008, Yuri Chechikhin was the General Director of Strategic Brand Creation & Development (SBCD Expo) where he owned 10% of shares. The most notable SBCD Expo’s project was Dream Planet – a campaign to change the negative public attitude towards nuclear power plants. Concurrently Chechikhin has established, jointly with National Guard Director’s son Roman Zolotov, Festivali Kino (Cinema Festivals) Limited Liability Company. The brothers-in-law have produced several films, including Voritily (Dealmakers) TV series – but failed to get expected profits.


In 2008, Chechikhin became the General Director of Izvestia (News) Open Joint Stock Company publishing a newspaper of the same name. After the resignation from Izvestia in 2011, he was an advisor in National Media Group.

Only four years ago, Chechikhin decided to try his hand at the construction business. In 2014, Zolotov’s son-in-law became one of the two cofounders of Domstroy Limited Liability Company owning 60% of its shares. Pretty soon, a small company has got a profitable contract to renovate Podmoskovie (Moscow Region) Sanatorium and Resort Complex belonging to the Ministry of Defense of the Russian Federation.


Yuri Chechikhin

Apparently, Deripaska expects to get the same kind of assistance in securing governmental contracts after transferring a portion of his development business to Chechikhin. On July 1, amendments to the law on shared-equity residential construction have come into effect tightening requirements to developers. After a year, since July 1, 2019, they won’t be able to use the co-investors’ funds until the construction completion and have to switch to bank project financing. Under the new conditions, it is more beneficial for developers not to implement shared-equity residential construction projects – but perform governmental contracts. The presence of Chechikhin drastically increases the chance to win governmental tenders for the construction business of Deripaska. The experts also believe that the change in the shareholders’ structure would boost Deripaska’s administrative levers of influence.

What the National Guard Director’s son-in-law is going to get in return? Of course, a portion of revenues generated by Aluminum King’s business. Chechikhin is pretty skillful in the administrative resource monetization. His wealth has increased greatly since the wedding with Zolotov’s daughter. Take, for instance, the list of luxury real properties belonging to the Chechikhin family. Back in 2004, the aspiring film producer became a neighbor of Zolotov in Barvikha village. In 2005 and 2008, Chechikhin purchased two adjacent lots and became the owner of more than 1.2 ha of very expensive land. In 2016, Maksim Leshchev, General Director of Geo Development Group, had estimated the value of metropolitan area lands belonging to Chechikhin at 360–720 million rubles ($5.8–11.6 million). 

In 2012, Chechikhin purchased another estate next door to Zolotov senior. The Director of the National Guard acquired a home in Kalchuga village, Odintsovo district, while his son-in-law purchased an adjacent lot 2.9 thousand square meters in size.

In addition to the lands in the Moscow region, Chechikhin bought in 2011 two apartments with a total living space of 400.9 square meters on Veresaeva street in Moscow. The value of these properties is estimated at 120–160.4 million rubles ($1.9–2.6 million). The cost of the residences is further boosted by the neighbors’ names – Alina Kabaeva’s sister Leisan Kabaeva, oligarch Aleksei Mordashov, Minister Lev Kuznetsov, etc. In addition, Mikhail Prokhorov used to live in the luxury building up until recently.


Home on Veresaeva street

In the same year of 2011, the Chechikhin family acquired another apartment with a living space of almost 500 square meters in a luxury building on Lomonosovsky avenue. Zhanna Zolotova became its official owner. The cost of a square meter of living space in that home is over $6 thousand – i.e. the value of the apartment belonging to National Guard Director’s daughter amounts to some $3.7 million.

18-year-old Artem Chechikhin is a vivid example of how beneficial is to be a relative of the National Guard Director. A few years ago, the parents sent the child from Barvikha to study in prestigious Cranleigh School located in 1.5 hour from London. The cost of education in the elite British boarding school is some 3 million rubles ($48.3 thousand) per year.


Artem Chechikhin

The investments into the heir’s education started paying back already. Not only is Artem spending parent’s money but also earning hard cold cash himself – on bitcoins. “I am a partner of AirBitClub company. We teach people how to earn money on cryptocurrencies and enable them to become company’s partners,” – told National Guard Director’s grandson to journalists.


In 2017, the US Securities and Exchange Commission has fined AirBitClub for Ponzi scheme creation. Artem Chechikhin attracts new clients using his channel on Telegram service prohibited in Russia and gains additional bonuses for that. “You get paid not only for engaging new people. You also make money on microleaps of bitcoin and ethereum rates. Initially, I was skeptical about this – but then I met senior company representatives in Russia, they helped me to understand everything, and now I have no doubts how this works. So, while this is working, why don’t capitalize on it?” – Chechikhin junior says. The business wonder kid plans to use the hardly earned money to launch a restaurant chain in the nearest future.


Being a worthy son of his father – film producer, Artem became an actor himself. His debut was a secondary role in Mot’s Na Dne (On the Bottom) music video. Later he played the main character in Roman Arkhipov’s Turn It Up music video. 

National Guard Director’s son Roman Zolotov is also skillful is trading the family’s influence. He gave up on his youthful hobby – movie production – long ago and switched to ‘adult businesses’.


Roman Zolotov

A few years ago, Zolotov junior was a member of the Board of Directors of Corporation Baikal. In late June 2018, he became a co-owner of Kvantovye Tekhnologii (Quantum Technologies) Research and Production Company intending to bring new quantum inventions to the market. The list of luxury properties belonging to Roman Zolotov is as impressive as his brother-in-law’s one: a residential home in Barvikha village with a living space of 676 square meters, over 88.5 thousand square meters of land in the same area, cottage with a living space of 188 square meters in Estosadok township near Sochi, and apartment with a living space of 160 square meters on Zvenigorodskaya street in Moscow. Zolotov junior also used to own a three-story home with a living space of almost 1 thousand square meters in Gelendzhik – but now the mansion belongs to some Lanfranco Cirillo, a full namesake of the famous Italian architect. 

Viktor Zolotov is not obliged to disclose assets of his adult son and daughter. Therefore, it is difficult to calculate the precise value of real estate belonging to the clan led by the National Guard Director. According to RBK Group, the cadastral value of all real properties controlled by the Zolotov family is 532.5 million rubles ($8.6 million), while their market value amounts to at least 750 million rubles ($12.1 million). There is no doubt that the clan of the most powerful enforcement functionary in Russia is going to become even more wealthy after sharing its huge administrative resource with Oleg Deripaska.



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