Mikhail Khabarov: Head of Board of the Trust Bank of Non-Core Assets

Mikhail Khabarov was born into a family of metallurgists. He aspired to greater things, admitting that, ‘… The material life of my parents didn't impress me… I needed to do something else.’ His parents encouraged him to further his academic education at the Moscow Institute of Steel and Alloys, from where he graduated in 1993. His qualification in automation of metallurgical production was followed by additional studies under the Ministry of Foreign Economic Relations of the Russian Federation in 1994, and an MBA from Pepperdine University in 2001. From humble beginnings – ostensibly as a window cleaner and ice cream vendor, he rapidly worked his way up to chief manager of ferrous metallurgy at Inkombank between 1994 and 1996.

Though there are some uncorroborated reports suggesting that he managed to acquire vast wealth during his studies. Thereafter, he moved to the Magnitogorsk Iron and Steel Group where he served in the capacity as Deputy Director for Economics, Finance, and Strategic Management. While there, he led in an important capacity as the enterprise moved towards privatization. The college that he attended – the Moscow Institute of Steel and Alloys – began as a typical Soviet educational institution, and ultimately became an institution that would give rise to powerful Russian elites and business leaders, many of whom are now featured on the Forbes Russian billionaires listing.

Plagued by Scandal in The Early Days

Owing to many scandalous transactions taking place behind-the-scenes, he fled to the United States in 1998, fearing criminal prosecution. That time several top managers of the Magnitogorsk Iron and Steel Group were accused of the embezzlement of a 30% stake in the Magnitogorsk Metallurgical Plant. Upon return, he joined ROSNO Insurance Group and served in the capacity of Financial Director and First Deputy General Director. By 2004, he was appointed as the General Director of ROSNO Asset Management Alliance – a management company that was formed by Sistema and Allianz Group. In 2006, he moved, along with a team of two dozen employees from Allianz ROSNO to Alfa Group.

As chairman of the Board of Directors, his career went into overdrive by 2010. That's when he assumed leadership of Alfa’s A1 company. This presented him with immense power, ultimately leading to him becoming known as a ruthless collector, racketeer, and corporate raider. In the years 2006 through 2010, he served as the Chairman of the Board for Alfa Capital Management Company. Then, on 4 October 2010, he assumed the role of president of A1 Investment Company, while sitting on the Board of Directors for Alfa Capital.

While Russia's economic stability was oftentimes threatened by the actions of Mikhail Khabarov and A1, he was largely left unchecked to continue in his corporate raiding, divestitures, buyouts, and associated activities. Among others, several leading examples of ruthless acquisitions took place over the years:

1. Avianova Airline - This low-cost Russian airline had its managing director ousted by Khabarov and A1. He claimed that the airline was unprofitable and needed to be taken over.
2. Moscow Plant of Computing-Analytical Machines – Khabarov’s company bought a substantial number of shares in this company, threatening a corporate takeover. This resulted in the management buying shares at a much higher price to retain control of the company.
3. A5 Pharmacy – this chain of pharmacies was pressured into selling minority shareholders’ shares to the primary owners.
4. Coal Company - the state-owned corporation, Uralvagonzavod was pressured by A1 to sell Zarechnaya Coal Company.

In 2015, Khabarov became co-owner of one of the largest logistics companies in Russia – Delovie Linii. In August 2017, he became engaged in a conflict with fellow co-owner, Alexander Bogatikov, filing a US$25 million lawsuit against him.

According to media reports, immense pressures were applied on the company's founder Alexander Bogatikov to cede 33% of the group’s shares.

CEO of National Bank Trust: Bad Debts Collection

As the recently appointed Chief Executive Officer (CEO) of National Bank Trust, Mikhail Khabarov is in an extremely powerful position. He has held this position since May 2019. As the CEO of the Bank for Non-Core Assets, his rise is attributed to the trust of high profile leaders who lobbied in his favour such as President of the Trust, Alexander Sokolov. Khabarov’s team from A1 is also on board at the National Bank Trust. In this important position, overseeing the government’s collection of 2 trillion RUB in debt, he is ‘directly responsible for the main profile’ of bad debts collection using his corporate raider abilities. This is generating fear within Russian economic circles, and for good reason.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes.