Archive for October, 2013

VIEW THE WORLDS MINING GIANTS HERE 31-40

Billionaire-2013-Slide-1

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Alexander-Nesis-Wikimedia-Commons

31…Potash

Alexander Nesis

Radiochemist knows how to make money from U3O8, K2CO3 and Au
$3bn | 50 | Divorced | 2 Children | Russia | ↑

Leningrad native and trained radiochemist kickstarted his shipbuilding and industrial investment business ICT with money from uranium mining in the Uzbek desert.

Founded Polymetal in the late 1990s, sold out to Suleiman Kerimov in 2005, only to buy most of it back on the cheap during the 2008 financial crisis. Still owns 19% of the well-run and relatively more transparent gold miner.

Like his billionaire Russian buddies Kerimov, Filaret Galchev, Alexander Nesis, Zelimkhan Mutsoev and Anatoly Skurov, Nesis hit the jackpot with the blockbuster merger of Uralkali and Silvinit in 2011. Today owns 10% of the combined group which has profit margins that would make Canada’s Potashcorp blush.

Prospects: Good – Uralkali’s long-term prospects are rock-solid, stands to make dough if and when the merger with Prokhorov’s Polyus goes ahead and this month inked a deal on a $1bn rare earth project

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Henry Sapiecha

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Patrice-Motsepe

32…Diversified

Patrice Motsepe

Lawyer who empowered himself and workers
$3bn | 51 | Married | 3 Children | South Africa | ↑ ↓

Born in Soweto, he got his business chops working in his father “spaza” shop or general dealer selling to the township’s many mineworkers.

Became a partner at top Johannesburg law firm before moving into mining services. Built up his African Rainbow Minerals with his sister, Bridgette starting in 1994 after the fall of Apartheid by buying up marginal assets under black empowerment program that mandates 26% black ownership of mines.

Pioneered concept of profit-sharing with ordinary miner workers at ARM which has interests in platinum, nickel, chrome, iron ore, manganese, coal, copper and gold and a partnership with Harmony Gold which he chairs.

Unlike many of South Africa’s black business elite, he steers clear of politics and this year joined the pledge to give away half his fortune to charity. Owns Mamelodi Sundowns, top South Africa soccer club

Prospects: Up and down – weathered the terrible year 2012 was for mining in South Africa well and expansion further north should start paying off

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Henry Sapiecha

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gautan_adani-image www.www-globalcommodities.com

33…Coal

Gautam Adani

Powerless to stop the slide in his fortune
$3bn | 50 | Married | 2 Children | India | ↓

Born into a merchant family, he started his path to riches as a young man sorting and trading diamonds in Mumbai after dropping out of college. Had a narrow escape in 2008 when terrorists attacked the Taj hotel in Mumbai where he was staying.

Was implicated in the illegal mining scandals in the state of Karnataka that led to a ban and appears to have fallen out of favour with Indian authorities who cut the ports business run by son Karan from state tenders.

From headquarters in Ahmedabad in Gujarat, he oversees the $7bn Adani Enterprises’s coal mines in Australia and Indonesia that feed the power generation business in India. Adani Power is struggling with debt and rising costs so he’s putting his Australian ports up for sale. Adani Mining may still IPO in London

Losing two-thirds of his wealth in two years didn’t stop him from throwing Karan and his bride Paridhi Shroff and 8,000 guests one of India’s biggest ever wedding parties (and that takes some doing) in February.

Prospects: Downhill – India’s long-term electrification ambitions are undimmed but Coalgate will hurt future deals

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Henry Sapiecha

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vasily-anisimov

34…Diversified

Vasily Anisimov

The on again off again oligarch
$3bn | 61 | Married | 4 Children | Russia | ↑

Ran supplies for a nuclear plant outside Moscow, had dealings with Marc Rich, disgraced founder of what is today Glencore, before setting up Coalco to buy stakes in mines and aluminum refineries including the second largest in the world Krasnoyarsk with purported local godfather Anatoly ‘The Bull’ Bykov.

Entirely sold out of Russian businesses and disappeared from the scene around 2000 to find solace in the Russian Orthodox faith after his daughter from a previous marriage and her husband were murdered.

In 2004 made a comeback as co-owner of Metalloinvest with Alisher Usmanov and Andrei Skoch, but sold his stake after Boris Berezovsky (since deceased) sued – ultimately unsuccessfully – for $2bn.

Keeps a low profile and unlike his fellow Russian billionaires prefers New York over London when not in Moscow. Daughter Anna is a well-known Manhattan socialite and property owner. An ex-model, she’s sometimes referred to as Russia’s Paris Hilton.

Prospects: Probably good – appears to have a handle on the wheels within wheels at the top of the Russian oligarchy

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Henry Sapiecha

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xstrata-glencore

35…Diversified

Glencore International

The Baar billionaires boys club
$2-3bn | 45-51 | Greece, Spain, US and UK | ↑

Glencore’s $10bn IPO, the biggest of 2011, minted four employee billionaires and also made billions for early US investor William Macaulay and Kazakhstan’s Bulat Utemuratov whose sale of zinc and gold mining co’s to the Swiss firm wrapped up October last year.

Spaniard Daniel Mate ($2.7bn) joined the Swiss-based trading and commodities behemoth in 1988 when controversial founder and fugitive pardoned by US president Bill Clinton before leaving office, Marc Rich, was still at the helm. Mate and Greek citizen Aristotelis Mistakidis ($2.7 billion) worked their way up from the commodity giant’s zinc, copper and lead trading department.

Oxford-grad biochemist Alex Beard ($2.1bn) heads up oil and American Tor Peterson ($2.3bn), a political science and French graduate from Duke University and only single man on the list replaced CEO Ivan Glasenberg at the top of the coal division in 2002.

Prospects: Good – the tie-up with Xstrata cleared the final hurdle in April and deal-hungry Glasenberg probably won’t stop raking in new assets

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Henry Sapiecha

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chen-fashu

36…Diversified

Chen Fashu

Fashu’s is a foundation after a fashion
$2-3bn | 52 | 4 Children | China | ↑ ↓

Chairman of the New Huadu Group, Chen runs some of China’s largest retail centres, the Tsingtao brewery and is locked in a court and boardroom battle to acquire a stake in state-owned Yunnan Baiyao Group, one of the country’s biggest pharmaceutical companies.

If the potentially highly lucrative pharma deal goes through, Chen may make good on his pledge to sell out of Zijin Mining Group, China’s number one gold and second largest copper miner, and donate the proceeds to his charitable foundation which was found to be little more than a shell.

Fujian-based Zijin picked up 90% of Australia’s Norton Gold Fields last year and is forging ahead with more buys outside China despite the gold price decline. Zijin shares in Hong Kong are down 26% in a year, but the company’s aggressive growth strategy remains on track and its domestic mines have some of the best margins in the world.

Prospects: Fair – his sale of a chunk of Tsingtao may indicate bigger problems in the group, but Zijin’s longer-term prospects remain bright

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Henry Sapiecha

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vladimir_kim

37…Base Metals

Vladimir Kim

Pledging shares after pledging to step aside
$2-3bn | 52 | Married | 3 Children | Kazakhstan | ↓

Of Korean descent he graduated from Almaty’s Architectural Institute in 1982 and became involved with Kazakhmys (then called ZhezkazganTsvetMet) during the 1990s when the Soviet era coal miner and power company was in complete disarray.

Made headlines in October 2010 when in one go, he sold $1.3 billion worth of stock to Kazakhstan’s sovereign wealth fund.

Will be stepping down as chairman of Kazakhmys which he listed in London in 2005, later this year, but is holding onto his 28% stake.

Kazakhmys shares have been decimated over the last year after a writedown of $2bn in the value of its 26% stake in fellow Kazahk miner ENRC.

Prospects: Not good – speculation is rife about reasons Kim is pledging more and more of his shares as loan collateral and the ENRC contagion is spreading

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Henry Sapiecha

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alexander-machkevich

38…Base Metals

Eurasian Natural Resources

Unlikely threesome brought together by mining moollah
$2-3bn | 59-60 | Kazakhstan, Israel, Belgium | ↑

Responsible for bringing Kazakhstan’s vast copper resources out from under the Soviets to the world, more specifically the FTSE.

Patok Chodiev built Eurasian Natural Resources with longtime pals Alexander Machkevich (pictured) and Alijan Ibragimov into a diversified miner which at its peak was worth more than $20 billion, but is now being abandoned by shareholders and its board.

Tends to get Involved in mining’s frontier markets including buying First Quantum Minerals’ assets in the DRC for a fraction of its value after what has been described as a strip and flip transaction facilitated by Israeli middleman Dan Gertler. After a court battle ENRC had to compensate the Canadian firm $1.25bn (still a bargain for ENRC) and in December 2012 bought the remainder of Gertler’s Camrose Resources for $550m.

While Chodiev runs his empire from Almaty, Kazakhstan, he was born in Uzbekistan, spent a lot of time in Japan and is a Belgian citizen. Ibragimov is a native of Kyrgyzstan and a devout Muslim with 6 sons. Machkevich is an Israeli citizen and a tireless promoter of the Jewish state and causes.

Prospects: Fair – corporate governance issues should see ENRC taken private again by the three founders, where deals can be done with less scrutiny

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Henry Sapiecha

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dan-gertler

39…Base Metals

Dan Gertler

Frontier financier with unorthodox business style
$2bn | 39 | Israel | Married | 9 Children | ↑

Learnt the trade from grandfather Moshe Schnitzer, Israeli diamond exchange founder. Arrived in the Congo in 1997 shortly after the coup through links with Chabad orthodox community.

Became close to DRC president Joseph Kabila and the late Augustin Katumba to bag mining projects using what his detractors call strip and flip tactics which once prompted the IMF to stop DRC’s aid over lack of transparency.

Biggest clients are Glencore and London-listed ENRC, which picked up Kolwezi, a flagship copper complex Gertler wrestled from Canada’s First Quantum. ENRC is now buying out one of Gertler’s many tax-haven based front companies Camrose for $550m.

Owns 63% stake in Africo Resources listed in Toronto, partners with state-owned Gecamines in various copper-cobalt, gold and iron projects and has a monopoly on the DRC diamond trade. Has also teamed up with South African presidential hopeful Tokyo Sexwale and New York hedge fund Och-Ziff.

Kabila has on occasion dispatched him as special peace envoy and Gertler answers his critics by saying he’s attracted $7bn worth of much-needed investment to the war-torn country and deserves the Nobel Prize.

Prospects: Fair – able to shrug off greater scrutiny of his businesses despite new conflict minerals rules and African copper has many good years ahead of it

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Henry Sapiecha

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victor-nusenkis

40…Coal

Viktor Nusenkis

Found religion and coking coal billions
$2bn | 59 | Married | 2 Children | Ukraine | ↑ ↓

Flouting Moscow’s rules, he quickly became Ukraine’s number one private coal trader before the break-up of the Soviet Union.

Worked under the protection of Ukraine’s attorney general Gennady Vasilyev before founding Energo Concern (Donetskstal) in 1993. Vasilyev is suing Nusenkis for half of Energo in a Cyprus court after local tribunals brought him no luck.

Empire includes thermal and coking coal mines and metallurgical plants in Ukraine, Russia, Czech Republic and Germany and he has moved into agriculture through a Latvian firm.

Nowadays sporting a bushy beard, he is a generous patron of the Russian orthodox church in Russia and Ukraine. All group offices sport temples or prayer rooms. Shares a Zosima elder as spiritual adviser with Ukrainian president Victor Yanukovych.

Prospects: May need a miracle – Energo’s ageing plants suffer from years of underinvestment and favourable state loans to the group may be drying up

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Henry Sapiecha

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VIEW THE WORLDS MINING GIANTS HERE 21-30

Billionaire-2013-Slide-1

BXKC

glencore_ivan_glasenberg_333

21…Diversified

Ivan Glasenberg

When creating a $200bn commodities giant is only the beginning
$7bn | 56 | Married | 2 Children | South Africa | ↑

Glencore CEO triumphed in one of mining’s longest and richest takeover battles and took the top job at the combined group from his Xstrata counterpart in the process.

A workaholic and voracious dealmaker Glasenberg will be the number two shareholder in Glencore-Xstrata after the Qatari sovereign wealth fund which he coaxed over to his side when the deal was on the brink of collapse.

Glasenberg, alumna of Wits University in Johannesburg, cut his teeth in his native South Africa’s coal industry in the 1980s and once represented the country in race-walking before moving to Australia.

Now living in Ruschlikon, Switzerland, his mailbox was bombed while he was hobnobbing with the wealthy and powerful in Davos in January and the media have now set their sights squarely on the obsessively private Glasenberg and his dealings around the world.

Prospects: Good – a vertically integrated Glencore-Xstrata will entrench its dominance in certain metals markets and Glasenberg will keep the mega-deals rolling in

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Henry Sapiecha

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beny-steinmetz

22…Precious Metals / Diamonds

Beny Steinmetz

Inherits diamond business; moves into strip and flip
$6-$7bn | 57 | Married | 4 Children | Israel | ↓

Born in Israel, Steinmetz moved to Antwerp as a young man to run the diamond trading business he inherited from his father Rubin.

Steinmetz Diamond Group, now based in Geneva Switzerland, tied up Angolan supply under De Beers’ nose and more recently diversified into oil, real estate and mining other than diamonds under the BSG Resources banner.

Estimates of his wealth vary wildly but more about his business dealing may be revealed in an ugly battle over the Simandou iron project in Guinea, half of which Steinmetz acquired for a fraction of its value under less than transparent circumstances days before the death of dictator Lansana Conté who had stripped it from Rio Tinto earlier.

The alleged strip & flip worked wonders for Steinmetz when in 2010 Vale bought half of his share for $2.5bn. After forking out the first $500m the Brazilian firm has now stopped making payments after dropping the project altogether. Also involved with fellow Israeli billionaire Dan Gertler in mining deals in the DRC.

Prospects: Not good – his Sierra Leone diamond mine was hit by deadly clashes in December and a corruption probe of Simandou may still catch up with him

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Henry Sapiecha

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Suleiman-Kerimov-2013

23…Diversified

Suleiman Kerimov

Financial wizard who likes to push it to the limit
$6-7bn | 47 | Married | 3 Children | Russia | ↑

High stakes dealmaker who managed to claw back losses in the 2008 banking collapse – he went from $17bn to $3bn thanks to ill-timed investment in JP Morgan, Goldman Sachs – by moving into potash and precious metals.

The main driving force behind the $8bn takeover by Uralkali of Silvinit to form the globe’s largest – and by far most profitable – potash miner in 2010. Sold a $3bn stake to China last year.

A math genius long suspected of being the front man for secret Kremlin investments, he built up a huge stake in Polymetal before listing the gold and silver miner in London. Followed it by buying 37% of Polyus Gold, Russia’s largest gold company.

Known for $10m parties where pop stars like Beyoncé provide entertainment, he nearly died from burns sustained after crashing his Ferrari on Nice’s streets.

Born in Russian backwater Dagestan near the border with Chechnya, he’s spent more than $300m on star players and a stadium to boost the local team Anzhi Makhachkala.

Prospects: Great – plans to merge Polymetal and Polyus has fallen through, but for well-connected Kerimov the next deal is never far away.

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Henry Sapiecha

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Niicky-Oppenheimer

24…Precious Metals / Diamonds

Nicky Oppenheimer & Family

Almost flawless exit from a sparkling family business
$6-7bn | 67 | Married | 1 Child | South Africa | ↑

In March 2012, diamonds and the Oppenheimer family, one of mining’s most storied relationships, officially came to an end.

Sold his family’s remaining 40% in De Beers which for most of its existence prospered by keeping an iron grip on the global rough diamond market for $5.1bn to another Oppenheimer creation Anglo-American, which Nicky’s grandfather Ernest co-founded with US financier JP Morgan in 1917.

In the late 1990s De Beers stopped stockpiling rough diamond supply and moved into retail and jewellery manufacturing and shortly after the Oppenheimers took the company private after a century-long listing on the Johannesburg Stock Exchange.

Holds a masters from Oxford, lives in Johannesburg within earshot of the AngloGold lion enclosure at the city zoo when he is not enjoying his Tswalu Kalahari game reserve, the largest of its kind in private hands.

Prospects: Good – Oppenheimer negotiated a great price for De Beers at a time when Rio and BHP were struggling to find buyers for their gem divisions

agbuugffc

Henry Sapiecha

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Forrest_600

25…Iron Ore & Steel

Andrew Forrest

Iron ore king rode the Chinese wave better than most
$5-6bn | 51 | Married | 3 Children | Australia | ↑ ↓

Twiggy (his nickname in school) was finally exonerated in October last year from charges he misled investors about his Fortescue Metals Group’s deals with China. He remains chairman, but the allegations cost him the CEO job.

Once a keen amateur boxer, he grew up on a farm in Pilbara, Australia’s iron ore heartland, and after working as a stock broker he founded Anaconda Nickel in 1994. His fortune is all tied up in FMG which he built up from nothing in 2003 to a 150mtpa outfit today on the back of the China-led boom.

Perth-based Forrest once called Australia’s mining taxes “evil” and this year joined Gina Rinehart in a political coalition to populate Australia’s north and exploit the vast resources on Asia’s doorstep. Tireless promotor of Aboriginal rights he’s promised to give away half his fortune

Prospects: Fair – debt-laden FMG looked wobbly when iron fell to 3-year lows in September 2012, but production plans are back on schedule and budget

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Henry Sapiecha

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dennis-washington-image www.www-globalcommodities.com

26..Base Metals

Dennis Washington

Sailing fanatic built his fortune the old-fashioned way
$5bn | 78 | Married | 2 Children | United States| ↑

Born in Spokane Washington, after an unhappy childhood in a broken home that included a bout with polio, he eventually settled down with his grandparents in Montana, the state he still calls home.

Got the start for Washington Co. construction from a $30,000 loan from a Caterpillar dealer and moved into mining with a copper and molybdenum mine in Butte, Montana, which he acquired in 1986 and shortly thereafter re-opened.

In contrast to the wild swings in many other billionaires’ fortunes Washington’s net worth has been steadily climbing and even the financial crisis of 2008 barely registered on his income statement.

A keen yacht-designer and sailor his Attessa IV is now worth more than $200m after a meticulous 40-month rebuild. Washington owns an island off the British Columbia coast.

Prospects: Good – his Butte mine, rail, heavy equipment and shipping companies are all chugging along nicely

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Henry Sapiecha

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alexander-abramov-image www.www-globalcommodities.com

27…Iron Ore & Steel

Alexander Abramov

Space researcher made the most of the rouble crisis
$4-5bn | 54 | Married | 3 Children | Russia | ↓

Most of the low-profile Moscovite’s money is held in Evraz plc, which he, Roman Abramovich and Alexander Frolov successfully listed in London in 2011, but which has taken a beating ever since.

Abramov, whose wealth peaked at $11.5 billion in 2008, wasn’t always a businessman; he started work at a Soviet defence and space research lab after graduating from the Moscow Institute of Physics before starting an Evraz-precursor in the Yeltsin era.

During the 1998 Russian financial crisis, bought up distressed steelmakers and coal assets at fire sale prices. Today Evraz holds vast greenfields projects in Siberia, operates iron and coal mines across Russia and Ukraine, including the region’s largest met coal producer Yuzhkuzbassugol and has extensive vanadium interests in South Africa and the US.

Prospects: Middling – his Evraz’s struggles are set to continue and like partner Abramovich he has to work hard keeping the Kremlin on side

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Henry Sapiecha

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Victor-Rashnikov

28…Iron Ore & Steel

Victor Rashnikov

Silver fox keeps iron grip on his beloved home town steel mill
$4bn | 64 | Married | 2 Children | Russia | ↓

Product of Magnitogorsk’s Mining and Metallurgical Institute, he still resides in the city 1,800 kilometres east of Moscow, shunning fellow Russian oligarchs and their London mansions and Monaco yachts.

Ultimate small town boy made good, he started at Magnitogorskiy Metallurgicheskiy Kombinat, Russia largest steel mill, as a machine minder, worked his way up and then followed the familiar playbook of buying up workers and the state’s shares at basement prices.

An ice hockey fan who made the local team Metallurg, Russia finest, his big pay day came in 2007 when he took MMK public in London pocketing $1bn. Still owns bulk of MMK after fighting off a takeover by fellow metals man Iskander Makhmudov by buying stock on the open market and investing heavily in Twiggy’s FMG.

He’s been ploughing back the money building hospitals, a cathedral and ski resorts and staging the country’s biggest fireworks show in Magnitogorsk every July 18, the old Soviet Day of the Metallurgist.

Prospects: Dicey – fortune is entirely tied to MMK, down 80% since 2011 but could go lower still.

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Henry Sapiecha

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andrei-guriev

29…Potash

Andrei Guriev

More green from a growing phosphate fortune
$4bn | 53 | Married | 2 Children | Russia | ↑

Bank balance is based on his stake put at anywhere from 50% to 70% in Phosagro the globe’s number two phosphate producer which he listed in London in 2011.

A former communist leader, he’s been senator representing Murmansk since 2001 and could have been higher on the list, but plans to merge Fosagro with Silvnit, fell through and the latter was scooped up by Uralkali adding billions to the fortunes of Russia’s already rich potash potentates.

Cut his teeth working form Mikhail Khodorkovsky, and when the Yukos billionaire was sent to prison after falling out with the Putin government, Guriev led a management buyout of one of the group’s divisions Apatit which is now part of Phosagro.

Prospects: Good – raised $500m in secondary offer in London in April and the fertilizer market remains strong

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Henry Sapiecha

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anil-agarwal-vedanta-group

30…Diversified

Anil Agarwal

Oil helps to lubricate rough iron ore and aluminum business
$3-4bn | 59 | Married | 2 Children | India | ↑ ↓

Stock of his London-listed Vedanta Resources has held up better than most miners thanks to new finds by its Indian oil division run by brother Navin.

Quit school at age 15 and started out as a scrap metal trader in Mumbai in 1976. Today Vedanta boasts $14bn in annual revenues with assets that span the globe including copper in Zambia and Australia, zinc in Namibia and Ireland, and top iron ore company Sesa Goa and Hindustan Zinc in India.

Was affected by iron mining ban in Goa and had to shut aluminum refineries as plans to extract bauxite from what the local animist tribe says is the sacred mountain of Niyamgiri in the impoverished state of Orissa, are blocked.

Keen cyclist and vegetarian Agarwal who lives in London is a devotee of the Hindu god Krishna. Plans for a $1bn Vedanta University in Orissa went nowhere.

Prospect: Goodish – runs a tight ship and iron ore business improving while oil business should offset aluminum problems in India

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Henry Sapiecha

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