Two well-known Russian billionaires have sold their shares in Russia’s largest private bank, Alfa-Bank, and its insurance company, Alfa Strakhovanie. These men, who were under international sanctions, sold their stakes to a longtime business partner, Andrei Kosogov. The total value of the deal was about $2.5 billion.
The billionaires owned nearly half of the bank and the insurance company. They decided to sell because they wanted to challenge the sanctions placed on them by the European Union (EU). These sanctions were imposed after Russia’s invasion of Ukraine. The EU had claimed that the two businessmen were helping the Russian government in ways that hurt Ukraine.
Andrei Kosogov, the buyer, is a businessman who has worked with the sellers for years. Unlike the billionaires, he is not under any sanctions. After this deal, Kosogov has become the largest owner of Alfa-Bank and other businesses connected to the group.
Russia’s Hidden Flow of Billions: US Banks Involved in Sanctions-Dodging Scheme
Sanctions and Legal Battles
The EU had accused the billionaires of being involved in activities that supported Russia’s actions in Ukraine. However, last year, the EU’s General Court ruled that there wasn’t enough proof to back these accusations. This was a small victory for the billionaires, but the sanctions against them were not completely removed. The EU had other reasons to keep the sanctions, saying the two men were major players in Russian industries that earn money for the Kremlin.
The billionaires are still fighting the remaining sanctions. If they win, the EU countries could lift the restrictions, appeal the court decision, or create new reasons to sanction them. For now, the sanctions remain in place.
The pressure from sanctions also forced these billionaires to give up control of LetterOne, a large investment group based in London. They had to step down from its board and sell their shares in related businesses.
Russian Government Steps In
The sale of Alfa-Bank and Alfa Strakhovanie was not a simple business deal. It involved the Russian government, which passed a law that forced companies important to the country’s economy to return to Russian ownership. This law made it easier for the billionaires to sell their stakes without needing approval from the EU.
US Imposes Crushing Sanctions on Yemen Kuwait Bank Over Houthi Links
Initially, the sale faced delays because approval was needed from authorities in Cyprus, where the companies had some of their holdings. While waiting for this approval, a Russian court stepped in and annulled the ownership rights held by the billionaires. This allowed the shares to be transferred to Kosogov without further complications.
To complete the purchase, Kosogov borrowed money from Gazprombank, a state-owned Russian bank. He also agreed to pay for the deal using his own resources, as per the sale agreements.
Experts believe that the Russian government’s intervention gave the billionaires a way to separate themselves from their businesses without it seeming like their decision. However, this process also ties the businesses more closely to Russia and its government, as the new laws protect these companies from being affected by sanctions.
The billionaires have not commented on this sale, and neither has Kosogov. For now, the sale marks a significant shift in control over one of Russia’s biggest banks and its related businesses.
