What do you give the man who has everything? It’s a ticklish problem of etiquette and shopping, particularly when the man in question is a Russian oligarch. No, not a Russian oligarch; the Russian oligarch, the oligarchs’ oligarch. He’s been called the richest man in Russia, with a fortune estimated at $18 billion (he really does have everything.) He’s on cordial terms with Vladimir Putin. The man I’m talking about politely demurs at the idea of buying a Premier League football club, in the same way that you or I might pass up the opportunity to acquire a personalised number plate. Trophies and vanity projects are not to the taste of the remarkable Viktor Vekselberg.
Who? Exactly: I told you he was remarkable.
For the wealthiest man in the former USSR to have remained below the radar is a feat of self-effacement worthy of the Stealth Bomber. The reason for Vekselberg’s invisibility is much the same, too: to avoid detection. I went to Moscow to find him, if I could.
“Russia’s richest man” is a title that can come at a price. A previous incumbent, Mikhail Khodorkovsky, who was ranked sixteenth in Forbes list of world billionaires in 2004, is tentatively looking forward to life as a free man again next year, after spending the past decade languishing in prison, convicted of tax evasion and embezzlement. Kremlinologists believe Khodorkovsky made the terrible error of ignoring Mother Russia’s unwritten compact with her gilded elite: “You can keep your fortunes, provided you keep your noses out of politics.” In the past few years, not one but several of these figures have met with premature deaths. Any diligent actuary would be bound to conclude that an entrée to the oligarchy was not a guarantee of a long and carefree life. In 2008, Georgian tycoon Arkady Patarkatsishvili was found dead at his mansion in Surrey after a suspected heart attack. It came a month after the 52-year-old told a newspaper that there was a plot to assassinate him. A one-time supporter of President Putin, he had gone into exile after the former KGB man came to power in Moscow. In November last year, Alexander Perepilichnyy also collapsed and died while jogging near his home counties home. He had been cooperating with investigators to expose a suspected Russian money-laundering scam. He was 44. And in March, 67-year-old Boris Berezovsky, an outspoken critic of Putin’s, was found dead in the bathroom of a house in Ascot, after apparently hanging himself.
All in all, the right answer to the question about what to give the man who has everything may well be: a wide berth — if only to avoid winding up as “collateral damage”, as billionaires perhaps call it. But that kind of thinking wasn’t going to get me an audience with Viktor Vekselberg, in order to pick his brains on behalf of Esquire readers, and so pass on the Business Secrets of the Oligarchs.
And Vekselberg’s dos and don’ts ought to be worth hearing. The 56-year-old former engineering graduate worked in a state laboratory for years before turning his hand to business in 1990. Just six years later, when Boris Yeltsin was doddering through his second term in the Kremlin, Vekselberg emerged as co-owner and chairman of Tyumen Oil (TNK), one of the country’s biggest oil and gas concerns. He took a controlling stake in the firm in 1997 and embarked on a lucrative joint venture with BP, said to be the largest private transaction in Russian history. Vekselberg also became the single most important player in the world aluminium market; he’s the tin man with the Midas touch. The Bloomberg Billionaires Index listed him as Russia’s richest individual, and the fortieth richest in the world, after his consortium AAK sold a share of its tie-up with BP last October. The rankings of the super-rich can turn on a single deal, or even an exchange rate blip, and the Uzbek-born Arsenal investor Alisher Usmanov was riding high on The Sunday Times Rich List early this year, with £13.3 billion to his name. But Vekselberg may well be the wealthiest individual domiciled in the mother country.
The rise of the oligarchs is a very Russian affair. They were canny enough to see the huge potential in the moribund industries of the Soviet Union’s late, unlamented command economy. Their story has echoes of Nikolai Gogol’s black comedy Dead Souls, first published in 1842. In those pre-Revolutionary times, when the Tsar ruled over all the Russians, the gentry were taxed according to how many serfs, or “souls”, they had on their estates. The taxman came calling more often than the scribes who compiled the census, so landowners often paid dues on workers who were no longer alive. In Gogol’s novel, the social climber Chichikov makes the rounds of the landed class, offering to take the title deeds to their “dead souls” off their hands. The nobs are nonplussed: why is this fool wasting his money on ghosts? But Chichikov knows that as a man with servants to his name, alive or otherwise, can gain access to the upper echelons of society, and so advance his own interests. He parlays his unorthodox acquisitions into real wealth, though he comes to a bad end when he’s arrested for forging a will.
But to return to my own social climbing: how was I to enter the exclusive world of Viktor Vekselberg, and get some face-time with the invisible man of eastern capitalism? Reflexively, I fell back on a tried and tested journalistic method. It’s the worst kept secret of the magazine racket that sweeteners and inducements just aren’t a problem at Esquire. You think you get Ronnie Corbett on the cover just because he likes to see his mug on the newsstands? But Vekselberg was different. No amount of women or Cuban cohibas or customised Gulfstreams was likely to turn his head. No, my best hope was to discover his blindspot, his Rosebud, the battered sled that would melt the heart of this Comrade Kane. And sure enough, I found my man’s Achilles heel. It was a weakness for priceless pieces of jewellery. They were impossibly dainty, and yet as bright and beguiling as the flares that burn in the gas fields of Siberia. Of course, these baubles lay beyond even Esquire’s pocket. Indeed, Vekselberg already owned several of them himself: in the end, you can’t give anything to the man who has everything; all you can do is reflect his own desires back to him. Where direct requests to discuss Vekselberg’s empire or Putin would have failed, I got through the oligarch’s discreetly-armoured door by appealing to his enthusiasm for the lost treasures of the Tsars: Fabergé eggs.
Our introductions took the form of cloak-and-dagger stuff straight out of an airport thriller. In a Moscow taxi one day, the mobile rang: it was a man calling himself Roman (not that one). He said: “If you are at the Ritz-Carlton Hotel in an hour, he’ll see you.” From the outside, the Ritz-Carlton does little to advertise its association with the city’s new rich, unless you count the airport-style X-ray scanner flanked by the commissionaires, or the idling motorcade of police 4x4s. But it wouldn’t take much imagination to see its dense and thrumming bunker, two floors below street-level, as the fortified den of a Master of the Universe. This was where Vekselberg kept his art collection, or part of it, the maritime scenes and the Russian Orthodox icons and the busts of the Tsars, all in the stirred air. I expected — do I mean, hoped? — that Vekselberg would turn out to be vulgar, ostentatious, given to indulging his whims like a spoiled teen. Instead, entering the vault at the centre of a small school of aides and flak-catchers was a man whose whole appearance and demeanour screamed the word “businesslike”. Though “murmured” would be a better word. He wasn’t short, exactly, nor was he tending to a few too many pounds; or rather, his navy suit made the best of him. It was a marvel, this piece of tailoring. It wasn’t eye-wateringly fancy: that would have been unconscionable. Nor was it effortfully hiding its fanciness: that would have been the choice of the amateur, the beginner; but, I now saw, a wretched solecism. No, Vekselberg’s suit was so well made that it was indistinguishable from an off-the-peg outfit that just happened to be exactly his size.
We toured his subterranean strong room. I said, “You keep a low profile. Is that a conscious decision?”
“You’re sure? You believe that I keep a low profile?” Vekselberg almost spluttered. “My personal opinion is that I’m in the media too much. I’m not a politician, I’m a businessman. I would like to be without any extra visibility.”
Vekselberg has attracted publicity because of the highlight of his art portfolio: nine “imperial” Fabergé eggs. They were the gifts of the Tsar to his wife and mother, and adorned their palatial breakfast table in St Petersburg on Easter mornings. If you’ve ever enjoyed a Kinder Surprise, you’ll be familiar with the magical Fabergé recipe: a toothsome exterior housing a delightful surprise. Except that jeweller Peter Carl Fabergé worked his alchemy with gold, diamonds and platinum rather than chocolate and plastic, and you could fill a retro school satchel with Kinder eggs many times over for the price of one of Fabergé’s: the last time one came on the market, in 2007, it fetched £9 million. The products of his workshop are bijouterie of spangled high camp, but they have a dark and even blood-soaked history. Fifty imperial eggs were made during the last years of the Romanovs. But then the Tsar and his family were sent into internal exile in Siberia, detained in the “House of Special Purpose”, and assassinated in the basement in 1918. It’s said that Lenin’s gunmen watched in astonishment as their opening fusillade bounced off the ladies of the imperial line. The bullets had ricocheted off Fabergé’s flawless gems, which the women had stitched into their bodices to prevent theft. The firing squad had to finish the grisly job with bayonets. The bodies of the Romanovs disappeared, and their exquisite Easter presents vanished from sight.
One by one, the eggs began surfacing again in the West, in the cabinets of other royal houses or American speculators. In February 2004, when the eggs belonging to the late magnate Malcolm Forbes came up for sale, Vekselberg swooped before the auctioneer could raise his gavel, and bought the lot. One of them is known as the Rosebud egg.
I asked, “Just between us, Viktor, what did they cost you?”
“It was slightly more than $100 million.”
“A lot of money.”
“Yes, a lot of money. I would like to say thank you to BP, because I became rich and could use part of that money for this important collection of cultural artefacts.”
But why hadn’t he followed his countryman Roman Abramovich and bought an English football team like Chelsea instead?
Vekselberg laughed. “I like football, but I think this is a very personal matter. I don’t see any negatives for some Russian rich man to buy a football club. Why not?”
We were accompanied by one of Vekselberg’s lawyers, with his security lanyard and his hair waxed into waves, and the air of a backroom boy at a casino, the one who knows all the algorithms.
Had Putin thanked the tycoon for recovering the country’s treasures?
Vekselberg said, “Yes. I’ve seen the emotion of our president. It’s important to him that a Russian citizen has brought back this important collection.”
But were they back? The whereabouts of the eggs were as opaque as Carl Fabergé’s finest agate. At least four of Vekselberg’s most valuable pieces were currently residing in an auctioneer’s lock-up in London. If it ever came to leaving Russia, they would make a nest egg fit for an oligarch. But Vekselberg said that his hoard of Faberges was almost constantly on tour, on loan to exhibitions, and would soon be installed in a purpose-built gallery in St Petersburg, restored at last to the home of the Romanovs.
“Talking of history, have things come full circle in Russia? There’s a relatively small group of people at the top who have all the money and resources. And the other people? Not so much.”
Vekselberg reminded me that he grew up under communism. “I was a Young Pioneer of the Soviet Union, and part of Komsomol, [the All-Union Leninist Young Communist League]. My parents were ordinary people, we lived in a small apartment. Everybody was equal, except for a small group, the party hierarchy, the nomenclatura.” But the right direction for the country was to restructure the economy, give opportunities to “active personalities”, promote privatisation and create competition. "We broke one system, and we’re just starting to build a new one. The new Russia is very young, twenty years old. That’s only one generation. We have a big gap between a small group of very rich men, and the biggest part of the population who are still not doing so well. But this is a process. I believe small businesses, middle-sized businesses, will grow and the gap will be smaller and smaller.”
Vekselberg wore a faux classic watch, one that I’d seen on the British High Street. On second thoughts, it was a genuine classic watch, handpicked to look like Joe Schmoe’s much-loved knock-off.
I said, “What’s it like to be so rich? It’s something you could never have anticipated when you lived with your parents in that small flat.”
Did Vekselberg’s face tighten minutely? He said, “You ask very difficult questions.”
“Well, many of us dream of having a lot of money, don’t we, rightly or wrongly, and you’re living the dream, as they say.”
“In Russia, or anywhere, people don’t like rich people. Yeah, OK, I have money, but the question is how I use it. It’s not easy, believe me, it’s not easy.” Vekselberg invested in new businesses, he said, creating jobs, and he was doing his bit to make the economy more innovative. “It’s needed a lot of effort and patience because this takes time. I do what I can do, this is my social obligation. I put in my time, I put in my money, I try to do the best I can do, and this is maybe the answer to your question. How do I like to spend my money? I try to see my country better and my people happier.” He could hardly be accused of conspicuous consumption. On the contrary, his personal aesthetic was low-vis, unshowy: it was night goggle-conservative, in fact, from the tips of his discreetly repointed teeth to the soles of his traditionally cobbled shoes
“I’ve never had any of the eggs in my house. It would just look terrible if I put some imperial eggs on my buffet,” said Vekselberg. I suppose he meant his sideboard, but he inadvertently evoked the groaning board chez Vekselberg instead, with its butler-supervised chafing dishes, its ice sculptures, the boxing gloves of hand-dived lobster. But perhaps his domestic arrangements were as unassuming as his wardrobe. If you would like him to take you on as his apprentice, you could do worse than send him a good book. Stock Market Tip of the Day: the richest man in Russia enjoys reading.
Did his fellow billionaires, the ones with the yachts and trophy sirens, feel that he was letting the side down, giving oligarchy a bad name? They are talked about as if they were a rat pack or a brotherhood, the Slav chapter of the Bilderberg Group, perhaps. Did they hang out together?
I asked Vekselberg, “Do you ever see Abramovich?”
He paused in front of a vitrine of antique cigarette cases. “We talk to each other from time to time,” he said.
“I wonder if your position has a negative side to it. It’s not always a safe thing to be the richest man in town, is it?”
“I think this time, when there is not so much security, will pass away. In the past, this was a really risky place to be a rich man, but that was the beginning of the Nineties, the country was unstable. Now Russia is a reasonably stable country, it’s not so hugely criminal. I don’t feel there’s a big risk to be in Russia now. Of course, I have security. But now?” Vekselberg shrugged. “I don’t feel there’s any risk for businessmen, international executives, anyone.”
Despite this, Vekselberg told me an astonishing thing. Of course, he admired the Fabergé eggs which had cost him a tsar’s ransom, and he took exception to critics who called them kitsch (“For me, this is real, real, art; ‘kitsch’? Anyone can do that!”) but he said that he didn’t have a favourite among his clutch of nine. Indeed, it seemed as though that he had never considered the matter before. Instead, he and his family regarded the objets as their patriotic burden. “My son takes great care of his motorcycle. He cleans and polishes it. He loves it. Why? Because it’s his. My family do not interpret the eggs as ours. They are public.”
Faberge eggs aren’t Vekselberg’s blindspot. In fact, they might be the most lynx-eyed investment he ever made. They aren’t a weakness; as rudimentary domestic science teaches us, an egg can be as hard as a diamond, under the right conditions. Bringing Russia’s treasures home to the motherland has earned Vekselberg goodwill in the highest circles. The man who has everything cannot have too much of that.
Stephen Smith is Culture Correspondent of BBC Newsnight.