THE TRIO OF KINGS: ROADS OF THE THREE LEADERS TO THE "KINGS OF THE STATE ORDER" LIST

Forbes has recently published its annual top list of the "Kings of the state order". Due to this rating the Russians can find out who wins most of state contracts and at what prices. Such publications clearly demonstrate that little has changed since the beginning of the 00s. A kind of closed groups of both customers and suppliers, which distribute and determine "who, what and how much", still exist in Russia. Who are the members of these closed clubs? Everybody knows about their success in recent years, but how have they reached this? What were they doing during the 90s and the 00s? We decided to find out more about biographies of the three winners.

ISKANDER MAKHMUDOV AND ANDREY BOKAREV GOT THE TOP OF THE FORBES LIST.

According to Forbes magazine, their customers are the Moscow Metro and the Russian Railways and the total price of state contracts reaches more then 130 billion rubles.

Iskander Kahramonovich was born on 5th of December 1963 in the city of Bukhara in a family of teachers of Bukhara colleges.

In 1984, the future oligarch graduated from the Arabic Department of the Faculty of Oriental Studies, Tashkent State University. Soon he became a translator of a group of Soviet military advisers and specialists in Libya – an analog of the "Rosvoruzhenie". He worked there until 1986, and then he worked as translator with group of Soviet military advisers in Iraq for 2 years.

Businessman Iskander (Iskandar) Makhmudov

After 1988, during two years Makhmudov was working on various positions in the "Uzbekintorg" company, which was state monopoly exporting cotton. Presumably, it was the time when he met with two brothers - Lev and Mikhail Cherniys. Soon, in 1990, the future powerful businessman moved to Moscow, where he began to actively cooperate with Cherniy brothers in the aluminum business and entered it as a junior partner of the company Trans World Group (TWG). Among the positions Makhmudov held were "the adviser of the representative in Russia and CIS" and "the Director General’s consultant".

In 1996, Mahmudov took his first senior post, becoming the CEO of Gai mining and processing plant, a major mining company in Ural. He was working on this post during two years. In the late 90s the future "King of the state order" with the help of Mikhail Cherniy started to establish Ural mining and metallurgical company, which included more than 20 large enterprises afterwards.

Apart from Cherniy brothers, Makhmudov's business partners were Oleg Deripaska, Alexander Abramov, Vladimir Lisin and others (even Roman Abramovich is believed to be his partner).

At the moment, the main assets, which brought Iskander Kahramonovich first place in the Forbes list, are companies:

• CJSC "Transmashholding"  (partially) - a manufacturer of rolling equipment for railway (locomotives) and metro (electric trains). The company's factories are located in several Russian cities - from Moscow to Penza.
• "Zheldorremmash" (partially) - a subsidiary of the Russian Railways, repairs locomotives. 
• "Aeroexpress" (partially) - a company provides services on transportation of passengers by railways between Moscow and the capital's airports.

In addition, Makhmudov holds stakes in companies, which provide services on the passengers’ transportation in Moscow and nutrition in the "Sapsan" trains.

We have mentioned Makhmudov’s oligarch partners, but nowadays one of his main associates is Andrey Bokarev.

There is little information about Bokarev. He was born in Moscow in 1966. Soon after graduating from the Moscow Finance Institute in 1995, he took his senior post of the Acting Chairman of the "NatsInvestBank" Board of Directors. After two years, he became a CEO of the "Roseksportles". Meanwhile, the businessman was engaged in export activities of the subsidiary company "Kuzbassrazrezugl", and became a Head of a representative office of the "Krutreyd AG" in Austria. In 1998, he became CEO of this company. Also he joined the government of the previously mentioned Ural Mining and Metallurgical Company. In 2003, Bokarev entered the Board of Directors of  CJSC "Transmashholding", and in 2008 became its Chairman of the Board of Directors. Bokarev and Mahmudov reissued 25% of the right of ownership of LLC "Aeroexpress" personally for themselves.

Thus, strong business tandem of Makhmudov and Bokarev, which began in the 90s, helped Makhmudov to take the lead in the Forbes list.

THE SECOND PLACE OF THE FORBES LIST WAS AWARDED TO ARKADY ROTENBERG. 

His customers are the "Gazprom" and the "OEK" (United Energy Company), and the total price of contracts reaches almost 103 billion rubles.

Russian entrepreneur Arkady Rotenberg

He was born on December 15, 1951 in Leningrad. At age of 13 he started wrestling, sambo at first and then judo, in the same group with Vladimir Putin. It may be concluded that this acquaintance has influenced fate of the businessman.

After graduating from the Leningrad Institute of Physical Culture, the future oligarch worked in different sports organizations in Leningrad. Mainly he coached children, and then he became a director of a Children’s and Youth Sports School. In the early 90s Rothenberg became Vladimir Putin’s regular judo sparring partner (at that time Putin served as the chairman of the Committee for External Relations of St. Petersburg Major’s Office).

In the early 90s Arcady’s younger brother Boris, who was a professional judo fighter too, got an offer to coach in Finland. While working in Finland, Boris came up with an idea to organize barter deliveries of goods from Finland to Russia. In the period from 1991 to 1995, the "Baltic Business Partners" Zrt., "Grant", "Shield", "Rotna" companies were established. Business relationships did not start with someone else, but with the structures of "Gazprom", which was their first customer of barter deliveries.

Business was going well, and by the end of the 90s Rothenberg had established various funds and information-analytical centers. The largest of the established companies was the "Sports Club Judo Yawara-Neva".

At the end of the 90s Rotenberg started active communication with people from Moscow, for example, with businessman Sergei Zivenko. They established two trading firms, which were located in the center of Moscow.

In the early 2000s, Arkady Rotenberg entered the "Taleon" company's Board of Directors in St. Petersburg with a wide range of activities - from development and gaming business to managing hotels and restaurants. But officially Rothenberg didn’t have a stake in the "Taleon" company.

The next major chapter in Arkady Rotenberg’s story of success was establishment of the "Severny morskoy put" bank (SMP Bank) with the help of his brother Boris in 2001. Arkady became the Chairman of the SMP Bank Board of Directors. By the end of the 00s, the SMP Bank has worked almost in fifty Russian cities, with more than 100 branches.

According to the Unified State Register of Legal Entities, in the mid-00s Arkady Rotenberg has founded more than two dozens of Ltd. companies, but the biggest asset was the bank. At the beginning of 2008, the cost of his assets reached more than 15 billion rubles (according to "Vedomosti").

Rotenberg’s successful business career continued in a different sphere, which allowed him to take second place in the Forbes list. It was supply of tubular products for the "Gazprom" company. The highest-level leaders of the country decided to make a private monopoly on the market in this sphere. For this purpose the "Trubny Metalloprokat" (Pipe rolled metal products) and the “Trubnaya Promyshlennost” (Pipe Industry) companies were founded and were owned by Rothenberg brothers. By 2010, "Severny Evropeisky Trubny Proect” (North European Pipe Project) was under control of the brothers. Thus, at the end of the 00s, the Rotenbergs managed to take under control almost the entire sphere of pipe products supply in Russia. But it was not enough, and in parallel with pipes supplies, brothers gained access to another business - the construction of pipelines. In 2007, Arkady Rotenberg established the "Stroygazmontazh" company. In the same year Rotenberg’s companies were transferred to use with the priority right to purchase of several major building organizations belonging to the "Gazprom". These companies have carried all of the "Gazprom" following large orders up to now.

By 2014, Arkady Rotenberg has become the only full-fledged owner of the "Stroygazmontazh" building company. In addition to the main pipelines, the company is engaged in the construction of all kinds of ground facilities and even marine construction.

THE LAST AMONG THE TOP THREE IS IVAN SHABALOV, WHO OWNS THE COMPANY "TRUBNIE INNOVATSIONNYE TEHNOLOGII” (PIPE INNOVATIVE TECHNOLOGIES). 

Its customer is the same "Gazprom" and the total price of the state contracts reaches 92 billion rubles.

Businessman Ivan Shabalov

Shabalov Ivan Pavlovich was born on January 16, 1959 in Uzbekistan city of Chirchik. Probably, he is the most intelligent among the three leaders. There are no any blind spots in his biography. After finishing school, he entered a good Moscow university. In 1983, he graduated with honors from the Department of metal forming in the Moscow Institute of Steel and Alloys. Then Shabalov continued to build a successful career as an intellectual. In 1987, he finished the Graduate School of the Central Research Institute of Ferrous Metallurgy named after I.P. Bardin. By 32 years he became a doctor of technical sciences, and deputy director of the institute. But then the 90s began, the times of a new era. Scientists started to leave cabinets for business to apply their theoretical knowledge into practice. From 1991 to 1995, he headed the Soviet-Swiss "TSK-Steel" company (Karaganda Metallurgical Plant and Swiss trader Sytco were among the founders). Meanwhile, in 1993-1996, Shabalov worked as an adviser of Russian First Vice Prime Minister Soskovets (a former CEO of the Karaganda plant). At that time, it was a common practice that business leaders (often oligarchs already) occupied government posts, such as deputy ministers, advisers, etc.

In 1995-2001, Ivan Pavlovich headed the "Russian Chrome" company. In 2001, he decided to create his own company "Inzhpromtehstroy" and became its Head. In the first half of the 00s, the companies carried out deliveries of steel products. Since 2004, Shabalov became the Chairman of the Coordinating Council of the Association of Manufacturers of Pipes. In 2005, the scholar co-founded the mentioned "Severny Evropeisky Trubny Proect”. He had been the principal owner of the company, before the control over the company passed to Arkady and Boris Rotenbergs. In addition to the firm, Shabalov founded another company "Trubniye Innovatsionnye tehnologii" (Pipe innovative technologies). He is the General Director of the company up to now.

While managing successful projects in Russia, the entrepreneur has established a business channel abroad. The "Eurotube" company, registered by Shabalov in Germany, has gained exclusive rights to purchase production of the German "Europipe" company in Russia and the CIS countries. Shabalov managed to cooperate with Rothenberg, while he headed the trading company "Gaztaged" in 2009 on the stage of its liquidation. The company was engaged in the supply of pipes for the needs of the gas industry, and the co-owners of it were the "Gazprom" and Boris Rotenberg.

Today Ivan Shabalov’s "Trubniye Innovatsionnye tehnologii" is engaged in the production and sale of components for pipelines.

As we can see, the top three "Kings of the state order" are people with different stories on their routs to this list. Standing on the "winners’ podium", the oligarchs represent other participants of it. Their careers are similar, and are divided into three categories.

The first category is the story of Makhmudov and Bokarev, This is an example of how to gain influence and large assets in the 90s, successfully consolidate it and get huge profits now, establishing contacts with the state.

The second category is the story of Arkady Rotenberg’s success, which shows how to materialize connections with the leadership of the country established in youth, having quite successful experience in running business in the '90s.

And finally, the third - less popular road to success – is the story of the scientist, who has excellent knowledge in a sphere, and passed the way from science and theory to the big business.