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NAIRIT RUBBER: A TWISTED TALE OF OFFSHORE AND RUSSIAN FINANCIAL DEALINGS
Kristine Aghalaryan
http://hetq.am/eng/news/22303/nairit-rubber-a-twisted-tale-of-offshore-and-russian-financial-dealings.html
15:50, January 14, 2013
How much money did Armenian and Russian government officials walk
away with?
In August 2006, Rhinoville Property Limited purchased 90% of the
stock in the Nairit Rubber Plant from HayGazArd for US $40 million.
The remaining 10% is owned by the Republic of Armenia; specifically
the Ministry of Energy and Natural Resources.
However, Rhinoville never paid any of it's cash for the purchase. In a
financial sleight of hand, Rhinoville used the factory as collateral to
obtain a $70 million loan from Interstate Bank. The company handed over
controlling rights over Nairit to the bank stemming from the shares.
After receiving the $70 million loan, Rhinoville purchased Nairit
for only $39 million. $1 million was registered as the plantâ~@~Ys
annual deficit.
The fate of the remaining $31 million is a mystery till today. We
will cover this later.
According to the contract the Armenian government signed with
Rhinoville, the latter was obliged to invest $120 million in the
factory. (The contract was signed by the late Prime Minister Andranik
Margaryan and Energy Minister Armen Movsisyan)
The initial $60 million was supposed to be invested by January
2009 and the plantâ~@~Ys overall production was to reach 2,500
tons. The other $60 million was to have been invested by January
2012. If production did not reach 2,500 tons by January 1, 2009 and
the scheduled investment not made in full, then the government was
authorized to take the difference of the investments in Rhinoville
Property Limited shares.
The transaction was conducted with the consent of the Armenian
government since the as yet paid for factory couldnâ~@~Yt have been
put up for collateral with the agreement of the government since it
owned shares as well.
Clearly, the Armenian government, in particular Energy Minister
A. Movsisyan and Prime Minister Tigran Sargsyan, knew the details of
the transaction since then RA Central Bank President Tigran Sargsyan
served as the rotating president of Interstate Bank in 2006. Details
of the transaction surely passed his desk.
We wrote to Energy Minister Armen Movsisyan, asking him to comment on
whether Rhinoville had fulfilled its obligations under the contract,
but have yet to receive any response. The minister also has refused
to grant Hetq an interview regarding the matter.
Armenian government officials seem more concerned with concealing
any traces about their failures to re-launch Nairit rather to get it
working again.
They have even removed traces of the governmentâ~@~Ys August 18
Decision N1131-A to sell the factory from the governmentâ~@~Ys official
website archive.
Thus, we are left with no official information on the transaction
despite scores of offshore companies, corporate lawyers and the large
sums of money involved.
Hetq received nothing from the Ministry of Energy, while the Ministry
of Finance sent bits and pieces of information, arguing that the bulk
was a â~@~\trade secretâ~@~].
Hovhannes Hakhinyan, the current director of Nairit, also refused
an interview. So did former director Vahan Melkonyan, arguing that
a prior Hetq article contained less than 10% fact. Melkonyan said he
didnâ~@~Yt trust us as a credible news outlet.
â~@~\When the RA authorities deem it proper that our international
partners (i.e. Interstate Bank, of which he is now a representative
in Armenia â~@~S author) officially refute all this, then we will
refute it,â~@~] Vahan Melkonyan told Hetq.
The strange beginning of Rhinoville Property Limited
In the summer of 2011, when reporters queried Minister Movsisyan
whether Armenian government officials held shares in Rhinoville,
the minister stated categorically that there were none. He also gave
assurances that neither the RA Prime Minister nor his brother held
shares in Rhinoville, the owner of Nairit.
â~@~\There are no officials from Armenia or even citizens of Armenia
in Rhinovilleâ~@~Ys list of shareholders, and there cannot be,â~@~]
Minister Movsisyan declared. He added that three European companies
founded Rhinoville, but that they had changed over time. â~@~\I
canâ~@~Yt tell you their names right now,â~@~] Movsisyan said to
avoid answering.
In reality, Armen Movsisyan knows full well who the founders and
shareholders of Rhinoville are. He was privy to the entire transaction
and knew the players involved. Yes, he was correct to say that no
Armenian officials hold shares in Rhinoville. But he was wrong about
his statements regarding the three European companies. Weâ~@~Yll now
show you why. In any event, the minister said what he did to confuse
the reporters.
Rhinoville Property Limited was registered on December 6, 2002. The
last know registration address is 60 Cannon Street, London, EC4N
6NP. The company conducted no trade activity until August 2006;
thatâ~@~Ys to say until it purchased Nairit.
Isnâ~@~Yt it more than surprising that the government of Armenia
entrusted the fate of Nairit to this company with no commercial
experience in rubber production? The question arises â~@~S what
possible profit could Minister Movsisyan expect to receive in return
for selling Nairit to such an unknown and untested off-shore company?
Nairit becomes the shareholder of Rhinoville Property Ltd.
The founder and sole shareholder of Rhinoville Property Limited was
one IMEX Executive Ltd., a company registered in the British Virgin
Islands. However, in the summer of 2006 there was a change in top
management and shareholders.
By the end of the year, two other off-shore companies took over the
shares of Rhinoville. They were Drayton Finance Ltd (810 shares)
and Latheron Properties Ltd (190 shares).
Now, letâ~@~Ys look at who owns Rhinoville.
Drayton Finance Limited was founded by IMEX Executive; the same
founder of Rhinoville. In Rhinovilleâ~@~Ys 2006 annual report,
which we obtained through British official sources, there is an
interesting line stating that the parent company of Rhinoville is
Drayton Finance Ltd., and the ultimate controlling party was one Sergey
Kulikov by virtue of beneficial interest in the issued share capital
of the company. At the time of the sale of Nairit, Sergey Kulikov
was serving as the Deputy Director of Interstate Bank. The Russian
press, when referring to Kulikov, write that he used his numerous
offshore companies to receive loans from interstate Bank for use
for his companies operating in Russia. Later, those companies were
declared bankrupt and were taken over by Interstate Bank. Afterwards,
the Russian General Prosecutor filed criminal charges against Kulikov
and he no longer works for Interstate Bank. (We will return to Kulikov
and his family in future article about Nairit)
In the financial report of financial year 2007, it states that as
of November 30, 2008 the ultimate controlling party became Mr Eric
Narsisyan on the transfer of Mr S. Kulikov's beneficial interest in
the issued share capital of Drayton Finance Limited.French-Armenian
Eric Narsisyan has served as one of the directors of Rhinoville
Properties for the past five years, assuming the position after the
death of his father Andre Narsisyan.
Latheron Properties Limited was also founded by IMEX Executive, but in
November 2008 Nairit LCC (ZAO Nairit) became the shareholder. According
to Nairit Plant Public relations and Press Director Anoush
Haroutyunyan, there never was nor is there now a Nairit LLC. However,
Russian sources list a Nairit LLC (Ð~WÐ~PÐ~^ Ð~]аиÑ~@иÑ~B),
and the name of Varduhie Matevosyan is listed as coordinator. The
company states it is mainly active in commodity trading including
sales and supplies to Nairit CJSC in Armenia. Matevosyan told Hetq
that Nairit LLC and Nairit Factory are one and the same, disclaiming
any involvement with any other Nairit LLC.
According to documents in our possession, as of January 1, 2012,
Drayton Finance and Latheron Properties are the shareholders of
Rhinoville Property Ltd. In turn, Nairit Plant CJSC is the sole owner
of both Drayton and Latheron.
In a weird about-face, it turns out that Nairit plant CJSC is the
90% shareholder of Rhinoville and the party responsible for its loan
contractual obligations.
(To be continued)
Photo: RA Minister of Energy and Natural Resources Armen Movsisyan
P.S. Edik Baghdasaryan also contributed in the preparation of this
article.
Home page
See also
Money Laudering Attempt Fails: Two Different Verdicts in Nayirit Case
Nayirit Workers Stage Protest Outside Presidential Palace Nayirit
Boondoggle: Idle Rubber Plant Has 10 Deputy Directors Getting Hefty
Wages $40 Million In Wages at Non-Operating Nayirit Rubber Plant
From: A. Papazian
Kristine Aghalaryan
http://hetq.am/eng/news/22303/nairit-rubber-a-twisted-tale-of-offshore-and-russian-financial-dealings.html
15:50, January 14, 2013
How much money did Armenian and Russian government officials walk
away with?
In August 2006, Rhinoville Property Limited purchased 90% of the
stock in the Nairit Rubber Plant from HayGazArd for US $40 million.
The remaining 10% is owned by the Republic of Armenia; specifically
the Ministry of Energy and Natural Resources.
However, Rhinoville never paid any of it's cash for the purchase. In a
financial sleight of hand, Rhinoville used the factory as collateral to
obtain a $70 million loan from Interstate Bank. The company handed over
controlling rights over Nairit to the bank stemming from the shares.
After receiving the $70 million loan, Rhinoville purchased Nairit
for only $39 million. $1 million was registered as the plantâ~@~Ys
annual deficit.
The fate of the remaining $31 million is a mystery till today. We
will cover this later.
According to the contract the Armenian government signed with
Rhinoville, the latter was obliged to invest $120 million in the
factory. (The contract was signed by the late Prime Minister Andranik
Margaryan and Energy Minister Armen Movsisyan)
The initial $60 million was supposed to be invested by January
2009 and the plantâ~@~Ys overall production was to reach 2,500
tons. The other $60 million was to have been invested by January
2012. If production did not reach 2,500 tons by January 1, 2009 and
the scheduled investment not made in full, then the government was
authorized to take the difference of the investments in Rhinoville
Property Limited shares.
The transaction was conducted with the consent of the Armenian
government since the as yet paid for factory couldnâ~@~Yt have been
put up for collateral with the agreement of the government since it
owned shares as well.
Clearly, the Armenian government, in particular Energy Minister
A. Movsisyan and Prime Minister Tigran Sargsyan, knew the details of
the transaction since then RA Central Bank President Tigran Sargsyan
served as the rotating president of Interstate Bank in 2006. Details
of the transaction surely passed his desk.
We wrote to Energy Minister Armen Movsisyan, asking him to comment on
whether Rhinoville had fulfilled its obligations under the contract,
but have yet to receive any response. The minister also has refused
to grant Hetq an interview regarding the matter.
Armenian government officials seem more concerned with concealing
any traces about their failures to re-launch Nairit rather to get it
working again.
They have even removed traces of the governmentâ~@~Ys August 18
Decision N1131-A to sell the factory from the governmentâ~@~Ys official
website archive.
Thus, we are left with no official information on the transaction
despite scores of offshore companies, corporate lawyers and the large
sums of money involved.
Hetq received nothing from the Ministry of Energy, while the Ministry
of Finance sent bits and pieces of information, arguing that the bulk
was a â~@~\trade secretâ~@~].
Hovhannes Hakhinyan, the current director of Nairit, also refused
an interview. So did former director Vahan Melkonyan, arguing that
a prior Hetq article contained less than 10% fact. Melkonyan said he
didnâ~@~Yt trust us as a credible news outlet.
â~@~\When the RA authorities deem it proper that our international
partners (i.e. Interstate Bank, of which he is now a representative
in Armenia â~@~S author) officially refute all this, then we will
refute it,â~@~] Vahan Melkonyan told Hetq.
The strange beginning of Rhinoville Property Limited
In the summer of 2011, when reporters queried Minister Movsisyan
whether Armenian government officials held shares in Rhinoville,
the minister stated categorically that there were none. He also gave
assurances that neither the RA Prime Minister nor his brother held
shares in Rhinoville, the owner of Nairit.
â~@~\There are no officials from Armenia or even citizens of Armenia
in Rhinovilleâ~@~Ys list of shareholders, and there cannot be,â~@~]
Minister Movsisyan declared. He added that three European companies
founded Rhinoville, but that they had changed over time. â~@~\I
canâ~@~Yt tell you their names right now,â~@~] Movsisyan said to
avoid answering.
In reality, Armen Movsisyan knows full well who the founders and
shareholders of Rhinoville are. He was privy to the entire transaction
and knew the players involved. Yes, he was correct to say that no
Armenian officials hold shares in Rhinoville. But he was wrong about
his statements regarding the three European companies. Weâ~@~Yll now
show you why. In any event, the minister said what he did to confuse
the reporters.
Rhinoville Property Limited was registered on December 6, 2002. The
last know registration address is 60 Cannon Street, London, EC4N
6NP. The company conducted no trade activity until August 2006;
thatâ~@~Ys to say until it purchased Nairit.
Isnâ~@~Yt it more than surprising that the government of Armenia
entrusted the fate of Nairit to this company with no commercial
experience in rubber production? The question arises â~@~S what
possible profit could Minister Movsisyan expect to receive in return
for selling Nairit to such an unknown and untested off-shore company?
Nairit becomes the shareholder of Rhinoville Property Ltd.
The founder and sole shareholder of Rhinoville Property Limited was
one IMEX Executive Ltd., a company registered in the British Virgin
Islands. However, in the summer of 2006 there was a change in top
management and shareholders.
By the end of the year, two other off-shore companies took over the
shares of Rhinoville. They were Drayton Finance Ltd (810 shares)
and Latheron Properties Ltd (190 shares).
Now, letâ~@~Ys look at who owns Rhinoville.
Drayton Finance Limited was founded by IMEX Executive; the same
founder of Rhinoville. In Rhinovilleâ~@~Ys 2006 annual report,
which we obtained through British official sources, there is an
interesting line stating that the parent company of Rhinoville is
Drayton Finance Ltd., and the ultimate controlling party was one Sergey
Kulikov by virtue of beneficial interest in the issued share capital
of the company. At the time of the sale of Nairit, Sergey Kulikov
was serving as the Deputy Director of Interstate Bank. The Russian
press, when referring to Kulikov, write that he used his numerous
offshore companies to receive loans from interstate Bank for use
for his companies operating in Russia. Later, those companies were
declared bankrupt and were taken over by Interstate Bank. Afterwards,
the Russian General Prosecutor filed criminal charges against Kulikov
and he no longer works for Interstate Bank. (We will return to Kulikov
and his family in future article about Nairit)
In the financial report of financial year 2007, it states that as
of November 30, 2008 the ultimate controlling party became Mr Eric
Narsisyan on the transfer of Mr S. Kulikov's beneficial interest in
the issued share capital of Drayton Finance Limited.French-Armenian
Eric Narsisyan has served as one of the directors of Rhinoville
Properties for the past five years, assuming the position after the
death of his father Andre Narsisyan.
Latheron Properties Limited was also founded by IMEX Executive, but in
November 2008 Nairit LCC (ZAO Nairit) became the shareholder. According
to Nairit Plant Public relations and Press Director Anoush
Haroutyunyan, there never was nor is there now a Nairit LLC. However,
Russian sources list a Nairit LLC (Ð~WÐ~PÐ~^ Ð~]аиÑ~@иÑ~B),
and the name of Varduhie Matevosyan is listed as coordinator. The
company states it is mainly active in commodity trading including
sales and supplies to Nairit CJSC in Armenia. Matevosyan told Hetq
that Nairit LLC and Nairit Factory are one and the same, disclaiming
any involvement with any other Nairit LLC.
According to documents in our possession, as of January 1, 2012,
Drayton Finance and Latheron Properties are the shareholders of
Rhinoville Property Ltd. In turn, Nairit Plant CJSC is the sole owner
of both Drayton and Latheron.
In a weird about-face, it turns out that Nairit plant CJSC is the
90% shareholder of Rhinoville and the party responsible for its loan
contractual obligations.
(To be continued)
Photo: RA Minister of Energy and Natural Resources Armen Movsisyan
P.S. Edik Baghdasaryan also contributed in the preparation of this
article.
Home page
See also
Money Laudering Attempt Fails: Two Different Verdicts in Nayirit Case
Nayirit Workers Stage Protest Outside Presidential Palace Nayirit
Boondoggle: Idle Rubber Plant Has 10 Deputy Directors Getting Hefty
Wages $40 Million In Wages at Non-Operating Nayirit Rubber Plant
From: A. Papazian