Mikhail Fridman (born April 21, 1964) is a major Russian businessman of Jewish origin. He is chairman of the supervisory board of Alfa Group, one of the largest private investment companies in Russia. In 2014, Forbes magazine estimated his fortune at $ 15.6 billion, which makes him the second among the richest people in Russia. How did Mikhail Fridman reach such a position? A biography, the family in which he was born and raised, is what helps the reader to understand the origins of his current success.
Childhood and youth
The biography of Mikhail Fridman began, like that of millions of other Soviet boys. He was born and raised in Lviv, Ukraine. His parents, already elderly people, were engineers, and his father was awarded the USSR State Prize for the development of navigation devices for military aircraft. They were very happy when the youngest son was born in the family. From childhood, Mikhail Fridman was distinguished by his zeal for science. In the process of studying, he repeatedly won school olympiads in physics and mathematics.
In Lviv, Misha graduated from high school in 1980. And then - to Moscow … He enters the Moscow Institute of Steel and Alloys. Many people who have taken part in life have married students. Mikhail Fridman did not escape this fate. The wife, Irkutsk Olga, was a fellow student of Mikhail.
In his student years, an entrepreneurial streak appeared for the first time in it. He becomes the organizer of youth discos, invites musicians and bards to them with payment of fees.
The beginning of a business career
After graduating from MISiS in 1986, Mikhail Fridman began working at the Elektrostal plant in the town of the same name near Moscow. But his time was drawing near, and when it came, Friedman did not miss a favorable moment.
In 1988, he began entrepreneurial activity by creating a group of friends from the institute of a cleaning cooperative that was engaged in window cleaning, where he used students from various universities, giving them the opportunity to earn additional income.
What did Alfa Group start with?
Along with German Khan, Alexei Kuzmichev and Peter Aven, Mikhail Fridman in 1989 founded the trading company Alfa-Photo, which was engaged in the sale of materials for photography, computers and photocopiers that had just appeared on the Soviet market.
Soon, having accumulated initial capital in the sale of office equipment, Friedman switches to the base product for all Russian oligarchs - oil products. The tool for their transfer abroad for our hero is the Soviet-Swiss company Alfa-Eco, the prototype of the future Alfa Group.
The company’s development follows the classical scheme for Russian capital: metal products are added to the flow of goods sent abroad, the volume of operations reaches such a level that in 1991 Fridman’s business structure has its own Alfa-Bank, whose board of directors he and heads.
Privatization of TNCs - the peak of the business career of Friedman and Co.
Actually, this story deserves a separate study. But briefly she looks like this. In the mid-90s, the then Russian government “pulled” to shreds the state-owned enterprise Rosneft, the successor to the USSR Ministry of Oil and Gas Industry. Rosneft singles out the most delicious pieces related to oil production (Nizhnevartovsk and Tyumen oil fields) and oil refining (Ryazan oil refinery). They are united in a newly created enterprise, which becomes the Tyumen Oil Company (TNK), then a state-owned enterprise. A privatization tender is announced immediately with three firms - applicants for transnational corporations, headed by outstanding "Russian" businessmen of that time: Mikhail Fridman (Alfa Group), V. Vekselberg (Renova) and L. Blavatnik (Access Industries). In order to more conveniently interact with each other during the privatization process, they are united in the Alfa Access Renova (AAR) consortium, which in 1997 became the owner of TNCs for sixteen subsequent years.
Tyumen Oil Company: running in a circle in the length of 16 years
During this time, the owners made many "fateful" decisions. First, in 2003 they merged with the British Petroleum Corporation into a joint TNK-BP structure, then in 2008 they quarreled with their British partners to death, so that the London High Court even “ruined” this wreck.
Finally, it became clear to the Russian leadership that there would be no sense in the owners of TNK-BP during the global economic crisis, and in 2013, the same state-owned company Rosneft bought their shares in the long-suffering enterprise from British and Russian owners. No one will tell Russian citizens how much in 1997 they paid the Russian state for the privatization of TNK Fridman-Vekselberg-Blavatnik. But it’s well known how much Rosneft spent for her purchase in 2012-13: the British spent $ 16.65 billion, and the AAR consortium - $ 27.73 billion, even though the partners each owned about 50% of the combined company.
How this money was distributed among themselves, Friedman - Vekselberg - Blavatnik is not known to anyone. But judging by the fact that the first of them, based on the proceeds of the sale, founded a new business in Europe - the L1 Group investment group, he did not stay in the loser.
What is Friedman’s business empire today?
Firstly, it is an investment group, which is now managed by Alfa-Bank (the largest Russian private bank), which includes such business structures as Alfa Capital Management, Rosvodokanal, Alfa Insurance and the A1 Group. The group owns the mobile operators Megafon and Vimpelcom, the retail chains Pyaterochka and Perekrestok.
In addition, Mikhail Fridman is the chairman of L1 Group, headquartered in Luxembourg. The business of this international investment group is focused on telecommunications assets and the energy sector of the economy. It includes two main divisions: “L1 Energy” and “L1 Technologies”. Friedman is also a member of the Supervisory Board of Deutsche DEA AG Erdoel, Hamburg, purchased by L1 Energy in 2015.
By the way, the board of directors of “L1 Group” includes old friends - Friedman's partners, with whom he started back in the late 80s: Kuzmichev, Khan, as well as P. Aven, the former minister of the Gaidar government of Russia.
Buying Assets in the North Sea
In March 2015, L1 Group acquired the German oil company RWE Dea for more than £ 5 billion. It owns 12 active oil and gas fields in the North Sea and oil fields in other places. The deal raised objections from the British government, which believes that it contradicts sanctions against Russian firms in connection with events in Ukraine. L1 Group intends to create a new company to launch production at new oil fields, led by the former head of British Petroleum, Lord Brown.
On March 4, 2015, British Minister for Energy and Climate Change Ed Davy gave Friedman one week to convince the UK government not to force him to sell oil and gas assets acquired in the North Sea. How this story ended is still unknown, but given the experience and ingenuity of Mikhail Fridman in business processes, you can be sure that he will find a way out this time too.
Community Activities in Jewish Organizations
Friedman is an active supporter of Jewish initiatives in Russia and other European countries. In 1996, he was one of the founders of the Russian Jewish Congress, currently a member of the Presidium of the REC. He makes a great contribution to the work of the European Jewish Foundation, a non-profit organization aimed at developing European Jewry and promoting tolerance and reconciliation on the continent.
Friedman, along with Stan Polovts and three colleagues, Russian Jewish billionaires Alexander Knaster, Peter Aven and German Khan, founded the Genesis Group, whose goal is to develop and improve Jewish identity among Jews around the world. Each year, the Genesis Group Prize is awarded to laureates who have achieved excellence and international fame in translating the character of the Jewish people through their commitment to national values.
At the first annual awards ceremony in Jerusalem in 2014, Friedman told the audience that it was designed to inspire a new generation of Jews through the outstanding professional achievements of the laureates, their contribution to universal culture and commitment to Jewish values.
Membership and activity in international and Russian public structures
Since 2005, Friedman has been Russia's representative on the Council on Foreign Relations, a non-profit American organization that brings together representatives of the global establishment, whose goal is to spread the American version of democracy around the world.
Friedman is a member of numerous Russian public organizations, including the Public Chamber of Russia, the Board of Directors of the Russian Union of Industrialists and Entrepreneurs, and the National Corporate Governance Council.
He is an active supporter of the Big Book national literary award and a member of the board of the Center for Supporting Russian Literature, focused on implementing cultural programs, promoting the ideals of humanism and respect for the values of Russian culture.
