The coronavirus pandemic rallied Russian business. Every large company today seeks to contribute to overcoming the viral threat by helping money, equipment, and healthcare professionals, employees and their families. However, even at such a moment, there are those who seek to benefit from the current situation. And it’s not only about small speculators, 40 times higher prices for medical masks. Some oligarchs play big, apparently trying to improve their shaky business for a state account under the guise of a pandemic.
“Letters of Happiness” to the Government of the Russian Federation
So, recently the media reported a letter that the owner of Uralchem Dmitry Mazepin wrote to First Deputy Prime Minister Andrei Belousov asking him to introduce support measures for the domestic chemical industry.
Among the proposed measures are government redemption of corporate bonds with reduced interest rates, provision of loans to enterprises at 1-1.5% for 3-5 years, state subsidies to agricultural producers for the purchase of fertilizers, as well as government subsidizing of the interest rate on loans taken from state banks. In other words, Mazepin is asking for government support for the industry and his company.
The owner of Uralchem, of course, is not the first to ask for state support in these difficult times. Earlier, Anastasia Tatulova, the founder of the AnderSon family cafe chain, asked the president for benefits with tears in her eyes. And it can be understood - the restaurant business was one of the first to take the brunt of quarantine events. Cafes and restaurants first faced a sharp outflow of customers, and then were completely closed. And they will be closed for another month, which will inevitably ruin many of them. Like hairdressers, non-chain stores of non-food products and other small and medium-sized businesses.
But one thing is the service sector, small and medium-sized enterprises, for which the month of idle death is similar, and quite another is an industrial giant like Uralchem. In addition, the production of mineral fertilizers is a strategic industry, the holding enterprises continue to work, and nobody stopped the main consumer - agriculture. In addition, the rapid growth of the dollar helps rather than creates problems - after all, a significant part of the products is exported, we must rejoice.
Over the past few years, the media have repeatedly written about the situations that the founder and owner of Uralchem faced long before the coronavirus pandemic. Although initially fortune was extremely favorable to him. A native of Minsk managed to make a fast-paced corporate career in Russia into “fat zero” and retrain from a hired top manager to the owner of the second largest company in the industry. In 2010, he triumphantly burst into the Forbes ranking, showing the best result among beginners and immediately taking 70th place.
Everything turned out well, wealth grew.
“In December 2013, Uralchem holding Dmitry Mazepin became the owner of 20% of Uralkali, having bought shares and GDRs for a total amount of $ 3.799 billion. The transaction was paid for using a seven-year loan of VTB Capital in the amount of up to $ 4.5 billion secured by the acquired Uralkali package. ”
After that, Forbes wrote that “nothing bad happened with Dmitry Mazepin's Uralchem company, except that it fell into the situation of“ currency mortgages ”... and the assessment of the state of its main owner was below the minimum level of $ 350 million.” In 2015, Mazepin left the Forbes rating - his condition no longer reaches the minimum for the honorary list of $ 350 million.
In an attempt to get out of this situation, Mazepin managed at the end of last year to agree with Sberbank on a loan of $ 3.9 billion. The money will go “to implement the Uralchem investment program” and “to improve the structure of the company's loan portfolio and optimize the repayment schedule,” joint communication of the company and the bank.
However, according to the Vedomosti electronic publication, “as of January 1, 2019, the debt amounted to approximately 281 billion rubles. ($ 4.4 billion), the debt / EBITDA ratio is 7.47, experts from the A.I.T. Analytical Center write in a study published in October 2019. The average value of this indicator in the chemical fertilizer industry is 1.59 , notes the managing director of IK Oriole Capital Dmitry Alexandrov. In his opinion, most likely, a new debt is taken to refinance existing loans. Perhaps the company was able to agree on refinancing the current debt at a lower rate, agrees ACRA senior director Maxim Khudalov. ”
Experts believe that the financial stability of the company is affected not only by the situation on the market, but also by management.
And what about coronavirus?
To put it mildly, the letter looks strange, taking into account the fact that other market participants seem to feel relatively good, helping the state overcome the crisis with coronavirus.
For example, Fosagro, another major Russian fertilizer producer, is providing assistance to medical facilities in the cities of presence. At the expense of the company, ambulances equipped with the necessary medical equipment and mechanical ventilation devices (IVL), ventilators themselves, syringes, test tubes, masks, goggles, infectious protection suits and disinfectants are purchased. In addition, the company acquires tests and reagents for conducting rapid tests for coronavirus for residents of the cities of presence and its employees, Fosagro reports on its official website.
Other companies - such as EuroChem and Acron - have taken all measures to protect their employees. Those who have not been transferred to remote work or have not been sent on paid leave are provided with masks and disinfectants. Other safety measures have been introduced at enterprises - regular temperature measurement, passing tests, changes in production processes to reduce contacts and the risk of the spread of the disease.
Against this background, the contribution of Uralchem to the fight against coronavirus is still rather pale. On the company's official website, it is described in sufficient detail that Dmitry Mazepin became the first major Russian businessman to go on voluntary clinical trials to rule out COVID-2019 infection, and the test turned out to be negative. Moscow office employees transferred to remote work.
And the magazine "Company" reported that "the Russian billionaire and owner of the company" Uralchem "Dmitry Mazepin will provide the city of Berezniki with a car with a megaphone." She will urge local residents to comply with quarantine, they told the magazine in Uralchem. That, in fact, is all that we managed to learn about the actions taken by one of the largest structures in our industry.
In addition to the cheap money mentioned above, Mazepin also asks the government for other preferences. For example, temporarily lift restrictions on the transportation of fertilizers through the Baltic states. Of course, for everyone - but the owner of Uralchem will again get the main benefit from such a decision. As far back as 2018, the Interlocutor reported: “In a neighboring but far from friendly Baltic country, Mazepin has control in two terminals at once. This is the terminal for transshipment of bulk mineral fertilizers built in 2013 in the port of Riga and the terminal for transshipment of liquid ammonia in the port of Ventspils acquired a year later. ”
Also among the proposals is the establishment in a legal act of the government that the spread of a new coronavirus infection in the current circumstances is an extraordinary and inevitable circumstance.
“This factor must be taken into account by the courts when considering the issue of missing the limitation period and should serve as the basis for its restoration. It is also necessary to suspend / extend all procedural terms provided for by the relevant procedural codes of the Russian Federation, ”the letter says, according to PRIME. The question arises, but is this creating a groundwork for new lawsuits, for example, with Togliattiazot, whose former management Uralchem is suing in recent years?
On the whole, the list of support measures with which the businessman turned to the government looks like a list of assistance specifically to Uralchem and other structures of the businessman. True, it is not very clear why the authorities should help the oligarch to develop his quite profitable business both domestically and abroad. Indeed, as far as we know, coronavirus did not cause a crisis in the fertilizer market, the prices remain the same, the conditions are the same for everyone. And other companies are doing quite well.