By John Helmer, Moscow

Magic is a type of confidence trickery, but not all confidence tricksters are magicians. The difference is whether, when the magician pulls, the hat has got a real rabbit in it.

Minerals under the ground have something in common with rabbits; that’s to say, sometimes they are there – sometimes there’s only the illusion they are. Junior mining companies have this much in common with magicians – if they point a wand and recite a spell, they expect you to believe they can deliver at the minehead what you can’t otherwise see underground. The other difference is that on the stock exchanges, mining company promoters can collect bigger fortunes than magicians with this sort of hocus pocus.
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by John Helmer - Tuesday, May 22nd, 2012
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By John Helmer, Moscow

Novolipetsk Metallurgical Combine (NLMK) and its owner Vladimir Lisin have won a suppression order against Nikolai Maximov, former owner of the Maxi group of minimills and scrap processors, from the Higher Regional Court of Hamburg. A three-judge panel has imposed a permanent injunction against publication in the press of claims by Maximov against Lisin, ruling that Maximov has made them up and despite dozens of court cases has failed to substantiate them.
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by John Helmer - Monday, May 21st, 2012
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By John Helmer, Moscow

In the tarot pack, the card of the Hanged Man is not one everyone wants to be dealt. To some it portends doom. Others believe it symbolizes the great awakening to occur the moment after death when, if, there is a resurrection. As cards go, it’s a big bettor who wants this one.

This week Sergei Frank, the chief executive of the state tanker group Sovcomflot, decided to resurrect in the UK High Court allegations of fraud and corruption against Sovcomflot’s former ship-chartering partner Yury Nikitin. Some of these charges were tried by the court in 2009, and dismissed in rulings by Justice Andrew Smith of December 2009 and March 2010.
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by John Helmer - Saturday, May 19th, 2012
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By John Helmer, Moscow

Sergei Generalov, the controlling shareholder and president of Far Eastern Shipping Company (Fesco), has apparently decided to sell the company, once the leading dry-cargo shipping company in Russia. The buyer negotiating for the takeover is reported to be the Summa Capital holding of Ziyavudin Magomedov, a rival of Generalov’s in the ports and container segments of the Russian marine market.

Generalov holds about 56% of Fesco through his holding, Industrial Investors. Another 13% of the shares are held as treasury stock through an offshore entity called Neteller Holdings.The European Bank for Reconstruction and Development and East Capital, a Swedish investment fund, have been minority stakeholders with 4% and 7%, respectively. Public shareholders of Fesco, whose primary listing is in Moscow, hold another 20%.
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by John Helmer - Friday, May 18th, 2012
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By John Helmer, Moscow

White Tiger Gold (WTG) was supposed to be the curtain-raiser on the Canadian stock market for Mikhail Prokhorov and Maxim Finsky, his childhood playmate, to sell shares in their collection of little known gold and other mineral prospects and mining licences in Russia. That collection is called Intergeo, and it cost Prokhorov and Finsky play money.

At one time, Prokhorov’s former shareholding partner in Norilsk Nickel, Vladimir Potanin, accused him and Finsky of filling Intergeo with stolen goods—licences originally acquired for Norilsk Nickel and with the latter’s money. That case never went to court because Prokhorov and Potanin managed to settle between themselves which side each would get out of the bed they had shared together. Finsky got out too on Prokhorov’s side, and became boss of Intergeo.
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by John Helmer - Thursday, May 17th, 2012
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By John Helmer, Moscow

The Fitch ratings agency today issued a warning that growing debt at Magnitogorsk Metallurgical Combine (MMK), owned by Victor Rashnikov, is at a “higher level than previously expected”. With prices for MMK’s products falling, the company’s free cashflow is under pressure, the Fitch report claims, as it downgraded its outlook forecast for MMK from stable to negative. The agency said also that it has made no changes to MMK’s long-term and short-term issuer default ratings, which are BB+ and B, respectively. It may issue a downgrade of those, the agency adds, if the negative cashflow persists.

MMK’s version of the Fitch warning attempts a cosmetic makeover. That is as convincing to investors as French silicone is to breasts.
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by John Helmer - Thursday, May 17th, 2012
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By John Helmer, Moscow

In Russia, and at sea aboard Russian ships, it’s common for crews not to be paid; the shipowners usually get away with it, at least as far as the General Prosecutor, Yury Chaika, is concerned.. The tale of the Lyubov Orlova, whose two Russian owners abandoned the cruise ship at a Canadian port, defaulted on their port, agent and fuel debts, and marooned the crew without salary or food, is a salutary example.

Not paying Russian seamen, and forcing them to work without pay, forcibly preventing them from leaving the ship, denying them medical treatment if they are injured, and locking them up to die – well, Chaika’s Vladivostok bureau for prosecuting transport offences has decided to bring charges under Article 127, Part 2, of the Russian Criminal Code. This follows the deaths of two Russian mariners aboard the Russian-owned, Tuvalu-flagged motor ship, SS Ross. It is the first time in living memory that illegal deprivation of an individual’s freedom for the purpose of compelling him to work – slave labour – has ever been charged in a Russian court.
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by John Helmer - Tuesday, May 15th, 2012
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By John Helmer, Moscow

By all accounts, particularly his own, Alexander Lebedev, aged 52, has been one of those clever KGB agents whose training inculcated the Protestant work ethic, and whose tour of duty in London the wits, to enable him to make a fortune without stealing from anyone; without bribery or administrative resources; without even being on favourable terms with President Vladimir Putin, Moscow Mayor Yury Luzhkov, or indeed anyone of significance in post-communist Russia. A private bank belonging originally to Gazprom, and Aeroflot, the state airline, are said to be the hidden hands by which Lebedev helped himself to his plenitude.
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by John Helmer - Thursday, May 10th, 2012
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By John Helmer, Moscow

In the Kremlin corridors under the new management, it is generally acknowledged that one of the stupidest things former President Dmitry Medvedev ever did was to order Russia’s representative on the UN Security Council to abstain from the vote and veto of the no-fly zone resolution aimed at the Muammar Qaddafi regime in Libya. That was on March 17, 2010. The Russian intelligence services already knew that US and British submarines were in place under the surface of the Mediterranean, ready to fire missiles to start a war that was intended to end in Qaddafi’s death. It did.
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by John Helmer - Sunday, May 6th, 2012
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By John Helmer, Moscow

Whoever Elena Egorova may be, she and Victor Rashnikov, owner of Magnitogorsk Metallurgical Combine (MMK), share exactly the same desire for personal anonymity and business secrecy as the Chelyabinsk court case against MMK’s half-billion dollar purchase of an Australian iron-ore mining project reaches its climax later this month. This is their story so far.

If anyone imagined that MMK is a public shareholding company with conventional accountability and corporate governance standards for spending $9 billion in annual revenues and $16 billion in assets, the action by a purported shareholder, with a name, a share, and nothing else, to halt the offshore acquisition has exposed a total blackout of information by Rashnikov’s company, and the refusal of Rashnikov, with 86% of the company shares, to explain his decision-making to his co-shareholders. But from the court file released this week, it now appears the plaintiff shareholder is as keen as the defendant oligarch to keep the evidence and the proceedings secret.
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by John Helmer - Friday, May 4th, 2012
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