Ukrainian billionaire Rinat Akhmetov remains resolute about supporting Ukraine in its efforts to fight back against Russia.
Courtesy Rinat Akhmetov
Rinat Akhmetov’s steel plants and electricity substations have been damaged by the attacks–and hundreds of his employees have been killed. But he’s determined to stay in Ukraine and support his country.
By Kerry A. Dolan
Nearly a year ago, Ukraine’s richest person, Rinat Akhmetov, pledged to do everything he could to help his country fight back against the war launched by Russia on February 24, 2022, promising to spare no expense. Since then, attacks by Russian soldiers have not only led to an estimated 100,000 dead or injured in Ukraine, but also have laid waste to some of Akhmetov’s holdings in the country. Russian forces destroyed key plants owned by his mining and steel firm Metinvest and ravaged substations of his power generation firm DTEK. Worse still, 517 of his employees are among the dead and another 1,000 are injured.
Yet Akhmetov, the son of a coal miner who grew up in Donetsk, remains committed to repair the damage, win the war and force Russia to make reparations. Metinvest, he tells Forbes by email, is still operating, but in a diminished capacity. He says he’s continuing to pay his 150,000 employees and that his group, SCM, paid $2 billion in taxes in 2022. (He’s also got a superyacht on order that’s being built at a reported price tag of $500 million.) In addition, through his foundation, his companies and the Donetsk-based professional soccer team he owns, Akhmetov says he’s given $150 million in goods and services, including infrastructure repair and energy supplies. His companies have also produced nearly 200,000 bullet-proof vests and armored shelters for the Ukrainian army.
The 56-year-old billionaire, whose fortune dropped from an estimated $14 billion before the war to a current $4.3 billion, responded to questions from Forbes earlier this week from an undisclosed location in Ukraine. His answers, provided to Forbes Ukraine, a licensed edition of Forbes, are below.
How is the war going? Do you see an end to it and what would “victory” for Ukraine be at this point?
RINAT AKHMETOV: The war is going the way Putin has never expected. He did not expect that Ukraine could withstand. But Ukraine has held out, liberated half of the territory occupied by his criminal troops and is heading towards victory. He did not expect that the Western world would stand united: yet the West is united as never before in supporting Ukraine. It has been providing economic and military assistance and imposing unprecedented sanctions. He did not expect that Ukraine could survive the winter without electricity and heating.
Our people have not only restored the energy grid and survived, but also showed Putin that we will never stop fighting for our freedom. He thought that Ukrainians would shower him with flowers, but we have met Russian soldiers with guns defending every inch of our homeland.
A victory for me means to restore the territorial integrity of Ukraine within the borders of 1991, which includes Donbas and the Crimea. It means that we punish the aggressor state for its crimes against humanity, get reparations from Russia, and implement a new Marshall Plan for Ukraine as a member of EU and NATO.
How are you operating your businesses during this time?
The way business operates has not changed, the circumstances have changed significantly. The management and supervisory boards of our businesses work 24/7, addressing the most challenging problems of wartime: from repair work and energy supplies to production of hundreds of thousands of bulletproof vests and armored shelters for the Ukrainian army. Our companies operate under severe conditions, providing employment and paying salaries, ensuring financial stability, paying taxes, and meeting their commitments to investors. In 2022, SCM companies paid over US$2 billion in taxes.
How would you describe the state of your companies? One estimate is that Metinvest, your steel company, is operating at 30%-50% of its capacity. Is that accurate?
The state of SCM companies is the same as the state of Ukraine’s economy. It is dire. Part of Metinvest’s assets (Azovstal, Ilyich Steel and several other plants) have been severely damaged or temporarily occupied. The assets of our energy holding DTEK are exposed to constant shelling and Russian drone attacks.
At the moment, Metinvest operates at 30%-50% of its capacity because of the constant shelling and as a result of the occupation of the Black Sea area, including the ports. We continue to extract gas, coal and iron ore, generate electricity, produce steel and invest in the future. One of the latest events: the purchase of licenses for the development of a gas field in the Poltava region for a record US$26 million that was paid to the national budget. The licenses were purchased at a transparent auction by DTEK, an energy company that plans to invest over US$20 million in this particular field.
Are you able to pay your employees? How many do you have? Can you estimate how many have left Ukraine? And how many have died?
SCM Group employs about 150,000 people now. They all receive full pay. More than 13,000 have been conscripted to the army, territorial defense forces and National Guard of Ukraine. The most tragic thing is that the war has claimed the lives of 517 of our employees and has wounded another 1,000. We work unfailingly to provide financial aid and any other assistance to our injured employees and the bereaved families.
You decided to shut down your media operations and TV channels. Can you talk about why you did that?
Ukraine has enacted a law on ‘oligarchs’ I disagree with. I have repeatedly stated: I have never been and will not be an oligarch. Not to be categorized as an ‘oligarch’ under this law, I fully complied with the legislation and thus was forced to shut down the media holding, a sectoral leader with a twenty-year history, a talented team of 4,000 employees, and US$1.5 billion in investments. It would have been impossible to sell it in this situation.
You have directed resources from your foundation to help the people of Ukraine. How much have you directed and where has the help been most needed and most effective?
We are doing everything we can to help our military to hold the line, and civilians to survive. One year into the war, SCM businesses, my foundation and FC Shakhtar [the professional soccer team in Donetsk] have donated US$150 million in aid to help Ukraine and Ukrainians. Our assistance includes body armor, vehicles, equipment and fortifications for the Ukrainian Defence Forces, medicines and other humanitarian aid for civilians, and efforts to keep critical infrastructure up and running. Today, each of our businesses has its own front held by our brave employees.
For example, Metinvest has used in-house resources to develop and produce more than 100 armored shelters for Ukrainian combatants on the front lines. They can withstand hits from artillery shells. Also, we have started producing armored steel. Today, every tenth bulletproof vest in Ukraine is made of Metinvest steel. Overall, we have produced and handed over to the Ukrainian military about 170,000 bulletproof vests for free.
Moreover, I took the decision to allocate an additional US$25 million to help the military service members who defended Mariupol. This project is called the Heart of Azovstal and has already been launched. We will help Mariupol defenders and the families of the missing and killed soldiers, as well as the families of prisoners of war.
Have you been able to start rebuilding at all?
We continue to restore our facilities after Russian missile strikes every day, I mean our energy facilities in the first place. All Ukrainian power companies restore damaged and destroyed facilities, helping the country to get through the winter. We are preparing for the large-scale reconstruction of our assets in Mariupol and are involved in the Mariupol Reborn project, a concept to rebuild the city.
To do this, we need to restore full control over the entire Ukrainian territory and receive reparations from the Russian Federation, which is what our legal team is busy with now. In addition to the application that I have filed with the European Court of Human Rights, SCM’s assets affected by Russia’s aggression against Ukraine have filed more than 60 claims with the ECHR. Our demands are clear: recognise that the actions of Russia violate the European Convention on Human Rights; and make Russia pay fair compensation. We are confident that we are right and we hope that the Court will make fair judgements in favor of Ukrainian applicants.
We have only begun to file claims against the Russian Federation. The ECHR [European Court of Human Rights] is the first institution where we seek justice, and we are going to file claims with other organizations. Russia must be held accountable for everything it has done since 2014 in the breakaway Luhansk and Donetsk regions, as well as for the actions of the terrorists controlled by Russia. We’re going to make updates on our additional legal actions against the Russian Federation soon. Russia must pay in full for the war it has unleashed, the factories it has destroyed and the infrastructure it has damaged.
We are calling on all Ukrainian allies, including G7 countries, to engage with us to develop an effective international system that will enable us to seek reparations from Russia, including at the expense of its state-owned assets, as well as companies controlled fully or partly by the Russian government. This system must operate to the benefit of Ukraine and all those affected by the war in Ukraine, both civilians and businesses. We will do everything we can to ensure that Russia is held fully accountable to all Ukrainians, including financially.”
What would you like the American people to know about the current state of the war, and what that has meant for business in Ukraine?
The American people are well aware of this terrible and unjust war unleashed by Putin against Ukraine. The American people know what the fight for freedom is. The American people are helping Ukraine win this war. After all, this war is much more than Putin’s attempt to take over Ukraine. This is a war against freedom and human dignity, against democracy and the free world, against the world order and security. We defend both ourselves and you. The U.S. President Biden’s leadership and his visit to Kyiv is historic, and bipartisan support for Ukraine is unprecedented. I am grateful to the American people and their leaders for their tremendous help.
How are you spending your days now?
I am staying in Ukraine just like many other Ukrainian people. I have not left Ukraine for a day. I have the same feelings as all Ukrainians. I wake up and go to bed, thinking only of victory of Ukraine, and I do everything I can to bring it closer: from my morning conference calls to my daily meetings.