Meet Russia’s richest man who just transferred $1 billion of his empire to his wife

March 3, 2022, 8:27 PM UTC

The hits are coming in fast and heavy for Russia’s oligarchs, and some of them might be coming up with creative ways to hold on to their wealth.

In a recent public filing submitted to the U.K. government on Wednesday, Russian mining company Nordgold revealed that majority owner Alexey Mordashov, billionaire businessman and potentially the richest man in Russia, secretly transferred his entire stake in Nordgold, around $1.1 billion,  to his wife, Marina Mordashova, in an effort to divest himself of assets vulnerable to E.U. sanctions targeting Russian oligarchs.

The businessman was placed on the EU’s latest list of sanctions targeting specific Russian oligarchs on Monday.

Mordashov is Russia’s richest man, according to Forbes’ annual billionaires’ list, with a family net worth clocking in at slightly more than $29 billion. Mordashov made his wealth primarily as the largest shareholder and chairman of Severstal, Russia’s fourth largest steelmaker by production volume. Nordgold was established in 2007 as a subsidiary of Severstal.

Nordgold did not immediately respond to Fortune’s request for comment.

The Nordgold filing in Britain revealed that Marina Mordashova now holds over 50% of the company’s shares, and also disclosed that Alexey Mordashov had been terminated from his role as company director, effective Wednesday.

It’s been a tough week for Mordashov and family, since the latest round of sanctions was released. On Wednesday, the businessman also stepped down from the board of another company he held major stocks in, German tour operator Tui.

Mordashov resigned voluntarily from Tui’s board, and the company explained his decision in a statement. “The aim of the EU sanctions is to prevent Mr. Mordashov from disposing of his shares in TUI AG,” the company said. “This is to prevent Mr. Mordashov from realizing any proceeds or profits from his investment in TUI.”

The EU sanctions being levied on Mordashov prohibit him from reaping any benefits from companies listed in European stock exchanges. His share and equity holdings will also be frozen, and he will lose rights to any eventual shareholder dividends.

In a statement presenting the latest round of sanctions, the EU stated that Mordashov was targeted because of his connections with television stations which “actively support the Russian government’s policies of destabilization of Ukraine.” Other alleged transgressions of Mordashov’s businesses that the EU said justified the sanctions include business dealings in Crimea, a proclaimed “independent territory” in southern Ukraine that Russia invaded in 2014, and owning stock in Bank Rossiya, the “personal bank of senior officials of the Russian Federation.”

Mordashov’s business interests outside of tourism and mining include media, energy and engineering projects, and private investments through Severstal’s parent company, Severgroup.

Sanctions imposed on Mordashov may make it impossible for Severstal to repay a $800 million bond, after Citigroup, the steelmaker’s correspondent bank, asked the company to receive a special authorization from a U.S. sanction enforcement agency before resuming its payments according to the Financial Times. Mordashov is so far not on any U.S. sanctions list, which is why Severstal did not already possess these authorizations.

Severstal is said to be in the process of applying for all the required licenses and regulatory procedures, but an inability to pay off its debts could make it the first Russian company to default since sanctions were put in place.

The oligarch also holds some more tangible assets that he may want to keep a close eye on, including a Bombardier Global 6000 private jet, a line of aircraft valued at around $62 million, and a $500 million yacht last spotted cruising around the Seychelles.

European authorities have been seizing the physical assets of Russian oligarchs like yachts and jet planes since sanctions first came into effect, with German officials recently claiming a 500-foot super yacht worth nearly $600 million from Alisher Usmanov, Russia’s sixth richest man.

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