Why FC Dynamo lost property and investors

After 12 years, FC Dynamo returns from VTB to the Dynamo society.
 New Year's Eve - December 29 the Presidium of the All-Russian Central Council of Sports Society (VFSO) "Dynamo" took the offer, VTB. For a symbolic 1 ruble Company will purchase from the State Bank 74.99% of shares of JSC "FC" Dynamo-Moscow ". But VTB has undertaken within three years after a deal to sponsor all professional clubs and to society "Dynamo", reported VFSO.

Earlier, the chairman of VFSO Vladimir Strzhalkovsky said that this year's budget of FC "Dynamo-Moscow" will be reduced by 60%. Based on the assessment Sports.ru, the budget of the club in the next season will be a little more than $ 20 million. About half of the previously promised to provide the club VTB. The rest will be able to draw from new sponsors Strzhalkovskiy hopes. At the end of 24 "Dynamo-Moscow" game takes 1st place in the First Division. However, even in the case of the return team in the Premier League to wait for the budget increase and the purchase of new players is not necessary, warn Strzhalkovskiy.

So ended dvenadtsatiletka in which the FC "Dynamo" belonged to commercial structures - Alexey Fedorychev, VTB, and at some point almost got brothers Boris and Arkady Rotenberg. Why, in the end the team was left with nothing? The club never knew how to live within our means and found heavy burden for investors.

The first investor

"For me, football - a hobby, not a business," - told in the mid-2000s. residing in Monaco businessman Alexei President Fedcominvest Fedorychev. In 2004, a grain merchant, sulfur and fertilizers all of a sudden became the owner of "Dinamo" football club. VFSO donated Fedorychev structures 70% stake in the club in exchange for a promise to repay debt and help finance. Search for investor club had not a good life. In 2004, the "Dynamo-Moscow" stood on the verge of relegation to the first division, taking 13th place in the club's been accumulating arrears of wages, had no money to buy players.

Fedorychev told in an interview with "Sport Express", in the two years he spent in the "Dynamo-Moscow" of 200 million euros. Of these, 140 million euros were spent on the purchase of ten Portuguese players, including such stars as Danny, Derlei, Maniche and Costinha, and their salaries. Investments are not paid back, the club in 2005 ranked only 8th place in the championship of the country, and was again a year later on the 14th position in the relegation zone of the Premier League.

 In the summer of 2006, Colonel-General Sergei Stepashin, while "Dynamo" head of the board of trustees, told reporters that the club by the autumn can buy "Nafta-Moscow" Suleiman Kerimov. Stepashin in the 1990s. head of the Federal Intelligence Service (later renamed the FSB), he was the Minister of Justice, Internal Affairs, and in 1999 was briefly prime minister in 2000-2013. He led by the Audit Chamber. He was considered and chief curator of FC "Dynamo" until 2008

However, representatives of Fedorychev assured that he does not want to sell the club. The search for a new owner began because of a conflict with Stepashin Fedorychev recalls close to the FC man. According to him, the reason was the desire to renew Fedorychev the entire real estate in Moscow club: a lease 31 hectares of land in Petrovsky Park and the central stadium and football arena located there. "It is practically possible, transmit Stepashin managed to block only", - says the source "Vedomosti".

Now Stepashin, head of the supervisory board of state corporation Housing Reform Fund. "Sergey V. still worried about the fate of the" Dinamo ", but declined to comment", - said the representative of the state corporation.

Fedorychev "Sport Express" has recently said that he wanted to engage in real estate for the benefit of the football club. According to the businessman, he "spent a lot of effort and money" to clear the park from flea markets, prepare a business plan. At the site of the central stadium I wanted to build a shopping and entertainment center and the stadium itself to transfer to the place of the small arena. In Petrovsky Park Fedorychev planned to offer hotels and offices. All this would work for the football club, convinces the businessman. "The prospect of billions of dollars in profits, especially in the conditions of rapidly growing at the time of real estate prices in Moscow, just a lot of people interested. And at some point our project, coordinated with the government of Moscow, could not get the ball rolling ", - quotes Fedorychev" Sport Express ". As soon as the businessman realized that he carry out a development project will not give, he lost interest in football.

Construction instead of football

As a result, the club got no Karimov (he never confirmed the interest in the "Dynamo"), and VTB. In summer 2006, the society "Dynamo" has signed a cooperation agreement with the state bank, which decided to finance the reconstruction of the stadium in Petrovsky Park. Controlled VFSO management company "Dynamo" in the VTB loans in a few months Fedorychev bought out 70% of the football club. In 2007, its Board of Directors headed by then-deputy chairman of VTB Igor Zavyalov. He said that the bank will invest $ 1 billion in the project of the complex reconstruction of the territory of the "Dinamo" central stadium, providing for the construction next to the stadium about 500 000 sq. m sport, commercial and residential real estate. According to calculations the banker, built by real estate club was to receive an annual $ 40 million in revenue, which is sufficient for the maintenance team. However, a few months Zavyalov went into a state corporation "Rostec".

After 10 years of reconstruction of Petrovsky Park is nearing completion. But neither the club nor the society from this will not get a dime. In early 2008, the club signed investment contracts with the UK "Dynamo" to swap his stadium and arena to share in the project to develop the Petrovsky Park. On the same day the Criminal Code of "Dynamo" has signed an investment agreement with VFSO "Dynamo", which in 2012 gave way to the rights of the football club. Details of the agreements the parties did not disclose.

Why the project has not met expectations? At the time of its commencement of commercial real estate market was at its peak, representative of VTB said. But in 2008, it has fallen dramatically, while the club's revenues grew strongly, he continues. Zavyalov refused to comment on issues related to the "Dynamo".

 Deprived of stadium and arena, FC "Dynamo" immediately laid VTB and the right to property is scheduled for construction. In 2008, the club's budget of $ 41 million in large part - $ 29.9 million - amounted to VTB loans received by collateral in the form of future income from the project "Petrovsky Park Arena", later renamed to "VTB Arena Park". Most of the funds - $ 28.6 million - had to go to pay salaries and bonuses to players. In 2009, a future income club received more loans for 400 million rubles. ($ 12.5 million at the average exchange rate in 2009).

In short, the club's debt to VTB continued to grow rapidly. As he admitted "Vedomosti" VTB former employee, a way to repay the debt actually was the same: to convert it into shares of "Dynamo" and share in the development project. And so it happened. In spring 2009, VTB and society "Dynamo" signed a memorandum under which the bank on account of the debt must go 75% minus 1 share of JSC "UK" Dynamo "and 74% of JSC" FC "Dynamo". The deal took two years.

At the same time I came and short take-off of FC "Dynamo". In 2008, for the first time since 1997 the club won the trophy - bronze medals in the championship of Russia. Supervised club while former Deputy Director General of "Rusal" on relations with Dmitry Ivanov public. Comment its work in the "Dynamo" for this publication, he refused. However, the club continued to spend money on expensive players: by 2010, their value reached, according to the Internet portal Transfermarkt.com, 90,5 million pounds.

 Abortive salvation

By 2013, VTB finally formed a project company for the building of "VTB Arena Park" and received the necessary documents for the start of construction. Now it was to decide what to do with non-core asset - FC "Dynamo", which is financed alone the bankers were quite interesting. Only the advertising costs of the bank on the club according to the statements of FC "Dynamo" averaged more than 4 billion rubles. in year. In addition, the structure of the bank paid for the lease of land in Petrovsky Park more than 1 billion rubles. only for 2013-2015 years. and financed the expensive construction of the stadium and office buildings, "VTB Arena Park", the share of which was intended including the public, and the club "Dynamo". The investment cost of the project is $ 1.5 billion, the payback period is set at nine years, told "Vedomosti" the press service of VTB Group.

By the time of the lack of funding suffered not only the players, "Dinamo". VFSO have not enough money for other professional clubs with the same name - hockey, volleyball, basketball.

In 2012, long-term chairman VFSO "Dynamo", General of the Army, the director of the Border Guard Service Vladimir Pronichev called to save hockey club longtime friend of President of Russia Vladimir Putin, the billionaire Arkady Rotenberg, had already seriously carried away in this sport. United Hockey Club (UCC) "Dynamo" was supposed to joint stock companies in the same way as the FC "Dynamo". Rothenberg had to buy 75% stake in the hockey club, 25% would be retained by the Company, he told a year later in an interview with "Kommersant" Pronichev. "We believe that clubs should go public and funded by responsible owners who are interested in getting sports results, and the implementation of long-term infrastructure projects <...> At the same time, we believe that all the projects at the" Dinamo "must remain a blocking stake. This requirement is hard ", - said Pronichev.

Rothenberg was appointed president of the UCC "Dynamo". But his brother Boris became president of football "Dynamo". In July 2013, VTB and structure Rothenberg announced the launch of association football and hockey, "Dynamo" club. "Creating a single club will optimize financial costs and improve asset management," - said in a joint statement, VTB and FC "Dynamo". On sponsorship UCC "Dynamo" bank then spent more than 1 billion rubles. in year.
excessive support

Sports Director of FC "Dynamo" Boris Rotenberg called Guram Adzhoeva familiar for hockey projects. Ajo led amateur Night Hockey League, in which the ice went matches Putin, senior officials and major businessmen.

In the "Dynamo" ajo she worked from 2013 to 2015 and remember that free let the club 28 players at one time purchased, according Sports.ru, not less than 23 million euros. This has helped to unload payroll - to save 68 million euros, he explained in an interview ajo Tula newspaper "Sloboda» (myslo.ru). He is currently working in Tula president of football club "Arsenal" patronized "Rostec".

However, the place of the departed came not less expensive players. In 2013, after the collapse of "Anji" due to lack of funding, "Dynamo" bought the key players of the club -. Igor Denisov, Yury Zhirkov, Alexander Kokorin, Vladimir Gabulov and other acquisition costs and pay the players the club did not disclose. In an interview with the online edition of "Chempionat.com" Ajo told that Rothenberg not only bought six players at the "Anji", but also took over the payment of their salaries.

From the annual "Dynamo" report, you can know that about this time the club has received a loan of 75 million euros from Cyprus Eflen Constructions Limited - offshore was among the beneficiaries of MBTS Bank Rotenberg.

 When Rothenberg market value "Dynamo-Moscow" players reached a record 128 million pounds (Transfermarkt.com data). The club was able to gain a foothold on the 4th place in the domestic league and the first time in its history in 2015 was released in 1/8 UEFA Europa League final. In the "Dynamo-Moscow" even talked about plans to become the champion of Russia, but in 2015 there was a scandal. Due to violations of the financial fair play, requiring that spending club have been commensurate with the income, UEFA word removed from the club's participation in the European Cup. From the report of the European officials indicated that for the 2013-2015 biennium. VTB spent on the support of FC "Dynamo-Moscow" more than 260 million euros. The deficit of the club for three years exceeded 307 million euro.

In the summer of 2015, Arkady and Boris Rotenberg simultaneously resigned as UCC and FC "Dynamo" presidents. Declaration by the United clubs did not take place.

What is the reason? Apparently, businessmen did not manage to agree on the terms of purchase clubs with a society "Dynamo".

At some point, society "Dinamo" wanted to take everything under control, said "Chempionat.com" ajo. "I have several times appealed to Arkady Romanovich [Rothenberg]. I explained the situation. And only after that he and his brother [Boris Rotenberg] began to accept the fact that the club is changing - and not for the better. And after a while we left the club, "- said Ajo. VTB, "Dynamo" and Rotenberg structures do not comment on their brief participation in sports projects. "With family Rotenberg never negotiated about any of their participation in the project" VTB Arena Park ", - said a representative of VTB Group.

After leaving the club became Rotenberg directly supervise Pronichev and his first deputy Sergey Sysoev and VTB announced its intention to return to society 74% stake in the club.

"Dynamo" because of the debt once again had to give up a part of the players, replacing them with players from the youth team. A year later, in May 2016, "Dynamo" for the first time in its history, took off from the Premier League.

Russian football, in principle, is not known for performance management, indicates the general director Dmitry Sports.ru Navosha. But the "Dynamo" - antiprimer even against this background, he adds. "Dynamo" took off from the Russian Premier League with a huge budget, which the Portuguese or Spanish club enough to win the European Cup, "- continues Navosha. According Sports.ru, in the season 2015/16, the budget "Dinamo" was $ 55 million a year earlier when Rothenberg it reached $ 160 million "The whole story is expressive monument at least incompetence" -.. Considers Navosha.

 The new leadership

In August of the society it had to go to Pronichev and his team. He led the "Dynamo" for 16 years. Could football club relegation from the Premier League to become the reason for his departure? Hardly. The reason for the resignation could be an Pronicheva four leaders of law enforcement agencies, including the Interior Ministry and the FSB, Putin, says a person close to the leadership of society "Dynamo". In the letter, security officials complained that the Pronicheva work on the development of service and application of sport -.. Ie, for the training of personnel - was not up to standard, says the source "Vedomosti". And it was this line of business of the company is the main, but not the development of professional sports clubs, he continues.

The new chairman of the society "Dynamo" was a former colleague of Putin's KGB, the former general director of "Norilsk Nickel" Vladimir Strzhalkovsky. The general director of FC "Dynamo" was a colleague Strzhalkovsky for "Norilsk Nickel", the former vice-governor of the Krasnodar Territory and the former CEO of the football club "Kuban" Eugene Ants.

According to the source "Vedomosti", the candidacy of the new chairman of the company has been agreed with Putin.

"The President has been informed of plans to replace [Pronicheva Strzhalkovsky]. However, any coordination with it is required. It is not his prerogative, "- he told" Vedomosti "presidential press secretary Dmitry Peskov. The possible correspondence he declined to comment.

New leadership "Dynamo" will save not only of FC "Dynamo-Moscow", but society itself, which expenses exceed revenues for a long time (see the. Incision). As found "Vedomosti", due to the football club debt to society "Dynamo" could also lose his part in the investment project "VTB Arena Park".

At the end of November 2016 of the Criminal Code "Dynamo" has hired an auditing company "Ernst & Young" for advice on preparing a number of transactions related to the FC "Dynamo". These include the sale of shares of the club for 1 rbl., The termination of investment contracts with FC, the club payment of compensation and repayment of promissory notes of FC "Dynamo-Moscow". Also, auditors should advise the customer on the additional issue of shares of JSC "UK" Dynamo. "

All of these transactions - by the door of the campaign VTB FC "Dynamo-Moscow". Bills debt of the club before the controlled VTB UK "Dynamo" at the end of 2015 amounted to 3.75 billion rubles. Another 412 mln rubles. Club should have a management company under the loan agreement. Debt expected to be settled at the expense of foreclosure, the club's share in investment contracts in 2008 "UK" Dynamo "will buy FC" Dynamo "right to commercial premises in a newly built complex" VTB Arena Park ", and we expect that it will help the club to resolve the issue with the financing for some time ", - said the representative of the VTB group.

Agreement on the termination of investment contracts of FC "Dynamo-Moscow" and VTB signed on September 28 but in fact they are not yet in force, since they require the approval of the collegial bodies of companies - Board of Directors and general meeting of shareholders, the representative of the VTB.

December 16 an extraordinary meeting of shareholders of JSC "FC" Dynamo-Moscow "has approved the sale of the rights to the commercial real estate in the project" VTB Arena Park ". And elect a new board of directors, in which three of the five seats went to representatives of VTB and two - VFSO.

Nevertheless, not yet determined the amount of compensation for the club.

"The transaction amount is considerable and largely solve the problem of the debt burden, but we can disclose it only with the agreement with the bank. With this step the debts to banks will be virtually extinguished "- conveyed through a representative Strzhalkovskiy. The size of the debt he did not disclose, but said that part of their club's lawyers assess as "quite controversial".

 Disputed the new head of "Dynamo" can be considered a football club debts related to the offshore company Rothenberg Eflen Constructions Limited. He was the club at the end of 2015 was due to 76.5 million euros, taking into account accrued interest. According to the loan agreement with the club should pay Eflen Constructions Limited before the end of 2016 in rubles at the exchange rate on the payment date. According to close to the "Dynamo" a source at the end of last year, the debt to Eflen Constructions considering accrued interest has already reached 79 million euros, or more than 5 billion rubles. (At the rate of the Central Bank on January 8 at 63.81 rubles. / Euros). Strzhalkovskiy hopes that this duty he will be able to restructure. According to VTB representative of FC debt was restructured before the offshore company for five years. He participated in restructuring itself whether VTB, do not disclose to the bank. "Dynamo" The representative said that the restructuring has not yet been legally formalized.

"Dinamo" society, as well as the club may lose its share in the project "VTB Arena Park". Now society has 25% plus 1 share of the Criminal Code of "Dynamo". The upcoming issue additional "Dynamo" of the Criminal Code may dilute the share VFSO project.

"The parameters of additional issue in the process of negotiation. The share VFSO "Dynamo" in the Criminal Code of "Dynamo" will not be eroded, "- says a representative of VTB. Strzhalkovsky representative said that VFSO "Dynamo" as a co-owner of the Criminal Code of "Dynamo" "is considering various options for additional capitalization of the company, not excluding the option of additional issue." But to reveal the sources of funds that "Dynamo" will be able to pay the forthcoming issue of shares, abandoned in society. Judging by the statements of available funds, the club is not.

According Strzhalkovsky, "Dinamo" society can lose a roof over his head. December 22 the chairman of "Dynamo" reported that the company must, before the end of January 2017 to sell the building in Lesnaya, 6, and to repay the loan or it goes into ownership of the bank - the company's creditors. Bank Strzhalkovskiy not named.

The nine-storey building (two floors are underground) far from the station. m. "Belarusian" "Dynamo" moved in 2012, when VTB structures began in Petrovsky Park demolition. At that time, the building belonged to the group VTB, which the "Dinamo" agreed to build in Petrovsky Park's new headquarters. "The new building for the" Dynamo "was to be built by the end of 2014, but deadlines were disrupted," - says Strzhalkovskiy. Not having received a new building in December 2014 was affiliated with the "Dynamo" Company "Dynamo - Wood, 6" VTB bought a house in the forest, the data show Rosreestra. 49% of the company belongs to one of Investtradebank companies. According to the statement, the building is pledged Investtradebank.

According to SPARC, in 2014, "Dynamo - Wood, 6" and related structures received loans of more than 1.78 billion rubles. In August 2015, the Central Bank introduced a temporary administration in Investtorgbank, from 2016 it is engaged in sanitation TCB. Rights claims under the loan agreements with the structures Investtradebank "Dynamo" passed in the pledge to the Deposit Insurance Agency. The press service of VTB to "Vedomosti" said that "the construction of the new headquarters of the" Dynamo "is coming to an end."

 As the "Dynamo" was getting closer to VTB

First, VTB and society "Dynamo" have agreed to establish a joint project company: In 2010, was established JSC "VTB Arena", 75% minus 1 share of which VTB has paid 18 billion rubles. "Dinamo" Company in payment of its share of 25% shares of the new Company contributed its 100% stake in ZAO "Petrovsky Park Arena" and 75% minus 1 share of JSC "UK" Dynamo "at the time owned a football club, rental rights land and real estate major.

"Petrovsky Park Arena", which society "Dynamo" has paid its share of the newly created company, the assets had not. It was a SPV-company through which VTB sponsored the football club and the development project "Dynamo", he said earlier "Vedomosti" Deputy President - Chairman of the Board of VTB Vasily Titov. In 2009, the banker led the Board of Directors of FC "Dynamo-Moscow".

"Petrovsky Park Arena" was established back in 2007. At the time of the transfer as payment for the shares of "VTB Arena" payables UAB "Petrovsky Park Arena" reached 13.4 billion rubles. In 2011 the "Petrovsky Park Arena" was attached to the "VTB-Arena" and eliminated all obligations of the former project company to VTB moved to the controlled bank "VTB-Arena". And in 2013, it was already eliminated itself "VTB Arena" - it was attached to the Criminal Code of "Dynamo", which became from that time the main company - owner of the club, the land and the investor "VTB Arena Park". General director of the Criminal Code of "Dynamo" in 2011, he became Senior Vice President of VTB Andrey Peregoudov, who replaced former First Deputy society "Dynamo" Sergey Sysoev.

 Security forces without money

The oldest in the country of the All-Russian Sports Society (VFSO) "Dynamo" was created in 1923 on the initiative of employees OGPU (United State Political Administration). The first honorary chairman of the "Dynamo" was the department chairman, Felix Dzerzhinsky, then - Commissioner General of State Security Genrikh Yagoda.

Now society includes 82 regional organizations, which run mostly heads of local structures of the FSB and the Interior Ministry, and the 14-dimensional organization of law enforcement agencies -. FSB, the Federal Security Service, Interior Ministry, Emergencies Ministry, etc., as well as the "Rosatom" and the Federal Financial Monitoring Service. This is explained by the fact that, historically, "Dynamo" was created for the development of service-applied sports - service dog, martial arts, biathlon and so on. The most titled club society is FC "Dynamo-Moscow", which is 11 times won the USSR championship six times - the USSR Cup and one times - the Cup of Russia.

According to the employee "Dynamo", basically society existed on donations. Some money comes at the expense of renting real estate - a small shooting ranges, etc...

The last few years VFSO as a football club, is living beyond its means. At the end of 2013, the society was in the accounts of the balance of 936 million rubles., By early 2016 it was reduced to 309 million rubles. According to SPARC, in 2015 "Dynamo" by the contributions of members of society, donations and business activities received 171 million rubles., And spent at least 100 million rubles. more. This is the biggest part of the "Dynamo" expenses - 179.5 million rubles. - Fell on the content of the company's management system.

In targeted interventions in 2015 spent RUB 109.5 million. In the "Dynamo" budget for 2017 laid a deficit of 160 million rubles., Said in December Strzhalkovskiy. The Company expects to receive revenues of 317 million rubles. (Of which 222 million rubles. In the framework of the federal target-oriented program of the Ministry of Sports and the budget). Expenses, excluding the football club "Dynamo", planned for 477 million rubles. "Dinamo" has reduced the staff from 180 to 114, their salary will be 91 million rubles., Added Strzhalkovskiy.