Lisin Tops Rich List With $18.8Bln

Novolipetsk Steel chairman Vladimir Lisin is Russia's richest person with a fortune of $18.8 billion, more than double his wealth last year, Finans magazine said Monday in its annual billionaires list.

He surpassed last year's leader, Onexim Group president Mikhail Prokhorov, and runner-up Roman Abramovich, now perhaps best known for owning the Chelsea football club, to top a Russia rich list for the first time.

The list tracks the country's 500 wealthiest individuals and estimates their wealth as of Dec. 31 of the preceding year.

And while the billionaires parade found a new leader, the top spots were all held by familiar faces. Surging prices for raw materials last year helped owners of oil and metals companies recover lost ground, while those who cashed out before the crisis saw their relative worth fall amid a generally rising tide.

The 2010 list also saw a tentative comeback by Russia's construction moguls, who were almost entirely shut out from last year's Finans list.

"The thaw on the financial markets knocked cash billionaires from their pedestals," Finans magazine wrote Monday. "Although the record results scored two years ago could not be reached, the current rating came very close to 2007."

Prokhorov — widely congratulated for selling assets including a 25 percent stake in Norilsk Nickel before the crisis hit — slid to second place with $17.85 billion, while Abramovich, who topped the Finans list in 2006, finished third with $17 billion. And while both fell on the list, their fortunes rose by $3.75 billion and $3.1 billion, respectively.

Oleg Deripaska, who topped the 2008 list with $40 billion, climbed two spots to No. 6 with an estimated $13.8 billion, more than double his $4.9 billion a year earlier.

The number of Russians worth at least $1 billion rose to 77, from 49 a year ago, and the combined wealth of the top 10 wealthiest jumped 84 percent year on year to $139.3 billion, Finans said last week. But the top 10 still have a way to go before they can match 2008's estimated $221 billion of wealth.

Finans editors wrote that they were surprised to see Lisin — whose fortune jumped from $7.7 billion a year ago — at the top of their list.

"Lisin is surprisingly little-known for a dollar multibillionaire, especially if you compare him with the 'number ones' of previous years," Finans wrote. "However, he is the lord and master in Lipetsk, and what's more, he's an honorary citizen of Lipetsk since summer 2009."

Lisin, 53, began working as an electrical fitter in Novokuznetsk while still a student at the Siberian Metallurgical Institute, from which he graduated in 1978. He worked in the metals industry through the Soviet period and was a partner in Mikhail Chernoi's Trans World Group in the 1990s.

He eventually bought out other shareholders at NLMK to become chairman and fought off Prokhorov and his former business partner, Vladimir Potanin, after they acquired a 34 percent stake in 2000, Finans said.

And while the married Lisin is not a tabloid favorite like some of his predecessors as Russia's leading billionaire, he has made a name for himself as a hunting enthusiast.

Last year, he became president of the European Shooting Confederation, and he has led the Russian Shooting Union since 2002. Lisin, whose surname comes from the Russian word for fox, also runs the elite Fox Lodge gaming club, which bills itself as the largest shooting complex in Europe.

Apart from his 85 percent stake in Novolipetsk Steel, Lisin has extensive interests in the city of Lipetsk, and he owns Universal Cargo Logistics holding, which controls a number of major ports. He also owns the Gazeta newspaper and last summer acquired United Business Media, which owns the Business-FM radio station.

Novolipetsk Steel shares closed Monday at 88.89 rubles on the MICEX, about 1 percent higher on the day and roughly in line with the broader exchange. That's an increase of 110 percent from a year earlier, when NLMK was trading at 42.26 rubles.

The steelmaker's shares fell as much as 87 percent in the stock market's collapse in late 2008, and Finans wrote that Lisin would lose the top spot if his main asset fell just 5 percent.

The magazine heralded Lisin's conservative management style — focusing on investment rather than the aggressive expansion abroad that left his competitors mired in debt — for what it said could be a long reign as No. 1. But the magazine also suggested that Prokhorov was to blame for his drop.

"Mikhail Prokhorov was losing money throughout the year. For instance, he accepted a disadvantageous settlement with Oleg Deripaska agreeing to get additional shares of RusAl instead of cash at a price 1.5 times higher than investors valued RusAl during its IPO," the magazine wrote. "He literally threw to the wind $100 million of 'investments' into the ZhiVi publishing house, which so far is only remembered for organizing a scandalous party on the Aurora cruiser."

Prokhorov lost at least $2.5 billion on a deal to acquire an additional stake of indebted RusAl, which he first joined as a shareholder after selling his stake in Norilsk to the aluminum producer. Before the January IPO, he raised his stake to 19.16 percent as part of a restructuring deal to cut RusAl's debt.

But the deal valued RusAl at $35 billion, Forbes Russia wrote last month, whereas IPO investors gave it a market capitalization of just more than $21 billion during a Hong Kong listing last month.

Deripaska, who gave up majority ownership of RusAl during the IPO, had a somewhat more successful year, winning promises from state banks to continue refinancing the aluminum giant's debt. RusAl used $2.14 billion raised from the IPO to pay down what had been $14.9 billion in debt, which in turn was down from $16.8 billion until a refinancing deal was agreed with more than 70 banks late last year.

This year's Finans list is also noteworthy for the re-emergence of real estate moguls, who were extinct as Russian billionaires by the time that Forbes put out its own list in May 2009.

Senator Andrei Molchanov, the main shareholder of St. Petersburg-based builder LSR Group, jumped 52 spots to 34th place with a fortune of $3.15 billion, compared with $450 million a year earlier.

Inteko president Yelena Baturina — the wife of Mayor Yury Luzhkov and Russia's longtime wealthiest woman — slid two positions to 47th, but her wealth more than doubled to $2.2 billion, from $1 billion in 2009. PIK co-owner Yury Zhukov also re-entered the billionaire's list with $1 billion, up from $870 million last year.

Senator Suleiman Kerimov, who owns the Nafta Moskva holding and now controls 45 percent of PIK, placed fourth on this year's list, with $14.5 billion. Another heavily diversified billionaire, Alfa Group chairman Mikhail Fridman, also rose one spot to No. 5, with $14.3 billion.

Finans commentator and entrepreneur Oleg Tinkov — worth $2.6 billion on Finans' list in 2006 — placed 424th with $150 million, down 58 spots. But he said he liked the 2010 trend nonetheless.

"We remember who were the richest before. It was mainly [people] who participated in the privatizations, the loans-for-shares auctions. Mikhail Prokhorov, Roman Abramovich, Mikhail Khodorkovsky," he wrote in his LiveJournal blog. "Lisin is a happy exclusion. He is an engineer. He cares about production — develops it."

But Tinkov said he was disappointed to see all the same people in the top positions: "The market should be changing, it should be shuffled. The cast of characters remains the same, despite the crisis and despite the mistakes they made."