Telegraph: 'Serious questions' over Alexander Lebedev's ambitions, says MP John Whittingdale

The FirstPost: Lebedev ropes in Egyptian tycoon to help buy Indy

Russian’s commitment under question as he seeks to share the Independent load

LAST UPDATED 7:09 AM, FEBRUARY 3, 2010

Alexander Lebedev, the Russian owner of the London Evening Standard, appears poised to bring a billionaire Egyptian partner into his proposed takeover of the Independent and Independent on Sunday newspapers.

According to the Guardian - which recently reported that Lebedev (above), a former KGB spy, is looking to replace Indy editor Roger Alton with Rod Liddle - the Russian tycoon wants to bring Samih Sawiris in on the deal.

The Sawiris family are Coptic Christians and known as one of Egypt's wealthiest families. Their fortune, estimated at $20 billion, comes from construction and cellphone businesses across North Africa, Italy, Greece, North Korea and Pakistan.

One of three brothers, Berlin-educated Samih is chairman and chief executive of Orascom Development. He's already an investor in al-Masry al-Youm, an Egyptian paper known for backing an independent editorial agenda, and he is known as an advocate of a progressive, secular, democratic future for Egypt.

Lebedev and Sawiris are already involved in a development in Switzerland where they plan to turn a disused barracks into a resort with an artificial beach and a golf course.

But Lebedev's plan to bring in a partner is raising questions about his commitment to purchase the Independent titles. Last week, he was quoted saying he would "absolutely" fund his proposed buyout from his own pocket. He's currently raising £450m from the sale of his stake in Aeroflot and the Ilyushin Finance Corporation.

"Ideally, he would like to liquidate everything in Russia and move to London," an unnamed source told the Guardian.

But it is thought the Independent's pension scheme and printing deals are proving stumbling blocks to any deal. Negotiations will automatically fail unless they are completed by February 15.

In an interview with the Daily Telegraph last week, Lebedev warned that his support of the Evening Standard, which he bought for £1 and assumption of debts, would not be limitless. The oligarch has given himself three years and £30m to turn around the paper which recently transformed itself into a freesheet to boost circulation to over 500,000.

Estimates of Lebedev's fortune vary. Several years ago it was said to be $3.8bn. Last year, Forbes placed it at $600m, while Finance magazine in Moscow said the figure was $1.95bn. "When I started negotiations about the Evening Standard, I had a nest egg of $1.5bn in stocks, which is not there any more," Lebedev told the Telegraph.

February 2, 2010
Russia Profile: The Russians Are Buying

http://www.russiaprofile.org/page.php?pageid=Business&articleid=a1265138271


By Svetlana Kononova
Special to Russia Profile

Despite the Crisis, Russians Still Show Huge Interest in Buying Property Abroad

“When the crisis had just begun, many Russians were scared by the unpredictable course of events, and they delayed their purchases. But things have changed since January of 2009. Demand for property abroad has risen since then,” said Marina Alekseeva, the general director at the Just Real Consult agency. “This trend is especially distinctive for West European countries with steady economies, which were least affected by the crisis, such as Germany, France and Italy,” she added.

George Shishkovsky, the managing director at the LondonDom.com estate agency, which specializes in UK real estate, agreed: “I would say customers from Russia and the former Soviet republics started buying more that they used to before the crunch - not only prime-class properties, but average two-bedroom flats, which cost about ₤1 million in London. It shows that the middle-classes are trying to invest their money in the traditional property market,” he said.

Shishkovsky claims that Russians are interested in the best areas of London. They prefer to invest money in the more modern, spacious buildings in the city center, preferably with car parking and security. Since the number of such properties is limited, they will also consider more traditional residential properties, such as townhouses and flats in Victorian houses. A novel trend is a growing number of buyers who wish to renovate flats or houses to their own taste. While Russian customers used to choose key-ready real property in the UK, nowadays more and more of them are prepared to rebuild and redecorate their new homes using the services of local design bureaus.

It is difficult to say how much exactly Russians spend on buying real estate abroad. Buyers try to keep their purchases confidential; some of them carry out transactions through corporate bodies they own, rather than in person, and others use complicated payment schemes involving foreign banks. However, a figure of around $10 billion spent on overseas properties in 2009 seems realistic, according to experts. Agencies say that Russians account for up to 30 percent of elite overseas properties. In the middle-priced and low-priced segments of the West European real estate market, buyers from Russia and the former Soviet republics are less notable, in comparison to those from the United States, India and the Middle East.

The choice of countries and properties available for sale ranges from cheap German flats (€25,000 to €70,000) to luxurious Mediterranean villas and European castles worth many millions. “We have noticed that the market has polarized during the crunch,” Alekseeva said. “For example, there are two kinds of properties in Germany that are most in demand: the cheap flats in Berlin, Stuttgart and other big cities, where property prices tend to grow, and the elite villas in Bavaria and the Baden Baden area surrounded by the beautiful countryside, lakes and mountains, which cost from €1 million to €2.5 million.”

Julia Titova, the head of the international department at the Moscow-based Best Nedvizhimost estate agency, marks the same trend. “There are two basic groups of customers,” she said. “The first group is interested in apartments costing €50,000 to €200,000 or in houses with prices from €150,000. But the second group has totally different preferences. These rich people are looking for unique properties with a long history, impressive architecture and the perfect location. They do not care how many millions these building might cost.”

Interestingly, most buyers do not buy overseas properties with the intention of living abroad permanently. According to Titova, many people are simply looking for a second home. They may send their families off to a sea-side house somewhere in Italy or Spain, or buy flats for grown-up children studying in West European universities, but the buyers themselves tend to live and work in Russia and only visit their second homes from time to time.

Then there are those looking for retirement homes. It may be difficult to believe given the poverty that afflicts most of Russia’s pensioners, but there are some people in the country who are wealthy enough to buy a second home abroad and enjoy their old age.

Moreover, some clients of real estate agencies consider big West European cities as places to run their own property business. “The crisis forced many businessmen to reconsider their assets,” Alekseeva pointed out, “some of them who never invested money in property abroad started doing that for economic reasons.” Statistics from Just Real Consult show increasing demand on commercial and investment property, such as hotels, boardinghouses and flats for rent. For example, in Rome and Milan buying to let can earn an annual profit up to seven percent; in big German cities – up to nine percent.

Apart from the profit margins, investing money in foreign real estate is attractive to many Russians because it can make it easier to obtain permanent residence in Western European countries. Although foreigners who own real estate do not receive permanent residence automatically, investors are welcome everywhere.

However, while interest in buying property abroad is on the up, some segments of the market show the opposite trend. The new, fast developing markets such the United Arab Emirates, Turkey, Bulgaria and Egypt have been the worst hit by the economic crisis, with a huge decline in the number of sales made to Russians. That might be explained by a shift in attitude: now is a time for sensible investments and minimal financial risks

February 3, 2010
Russia Profile: Policing the Peace

http://www.russiaprofile.org/page.php?pageid=Politics&articleid=a1265148956


By Tom Balmforth
Russia Profile

Is the Authorities’ Approach to Crowd Control Completely Irrational?

Sunday’s rally at Triumfalnaya Square in central Moscow was the most recent in a series of protests taking place on the 31st of each month which has one, which are organized by the leaders of the Other Russia and Solidarnost opposition parties and the Memorial human rights group. They are rallying in defense of Article 31 of the Russian Constitution, which enshrines the right to freedom of assembly. Reports of the number of protestors this time vary from 300 to 1000, but Oleg Orlov, the head of the human rights department at Memorial, told Russia Profile he thought it was closer to 1000.

Despite Triumfalnaya Square’s size, the protesters initially spilled over into the road because the center of the square was cordoned off by the police, according to Orlov, who took part in the demonstration. Apparently the restricted area had previously been designated for a children’s event that same today called “Winter Fun.” Nonetheless, for a large portion of the day there were no children there and when a small number did actually appear in the afternoon, they turned out to be the police’s children, said Orlov.

Protesters have encountered this problem before – when they last met on December 31, their rally was ruled illegal on the grounds that Triumfalnaya Square had been reserved for another event entitled “2010 Seconds until New Year.” The protesters went ahead regardless but were either arrested or dispersed.

Orlov said this time round the police showed more restraint to start with, but at around six pm this changed dramatically. “Suddenly they started to link arms en masse and drive the crowds back into separate groups, some toward the metro and others toward the road…it was as if someone had just given the order for there to be arrests,” said Orlov. “This included anyone who was holding a banner saying ‘freedom’ or ‘down with Putin’ on it, but also anyone who happened to be there – a friend of mine standing near me entirely calmly, not shouting or trying to participate was arrested, but she was released because she is a journalist and the police were given orders not to arrest the press,” said Orlov.

Police behavior on Sunday did show it had learnt from previous mistakes. Two weeks ago Russia’s under-fire Interior Ministry was at the center of a scandal when some thirty of Russia’s top media figures accused the police of trumping-up evidence leading to a RIA Novosti photographer’s “unjust” arrest and conviction for doing his job - photographing a demonstration. On Sunday journalists were simply freed if they presented accreditation, Orlov said.

The police also stayed away from Lyudmilla Alexeyeva, the 82-year-old human rights activist and leader of Moscow Helsinki Group, who spent Sunday’s demonstration next to Solidarnost leader Boris Nemtsov. Photographs of Russian policemen hauling her away at the New Year’s Eve protest were apparently sufficiently embarrassing to deter a repetition.

But taking a softer approach to the press and keeping away from Alexeyeva was not enough to avoid controversy, both domestically and internationally. “The United States is concerned by reports that authorities in Moscow on January 31 once again broke up a peaceful demonstration by Russian citizens,” said U.S. State Department spokesman Gordon Duguid, RIA Novosti reported. One hundred demonstrators were detained including Nemtsov, National Bolshevik Party Leader Eduard Limonov, and Orlov. The three will be summoned to court to face charges of taking part in an unsanctioned demonstration on February 4, 3, and 25, respectively.

To cap it all, criticism of the heavy-handed approach to opposition protests has come from the least expected of places – the paramilitary OMON riot police themselves. On Monday the weekly current affairs magazine New Times published a lengthy interview with five OMON officers who signed a written appeal to Russian President Dmitry Medvedev to stand up to abuses of power by their superiors. The officers, all of the Second Battalion of the Moscow OMON, allege numerous abuses including that their commander - Colonel Sergey Yevtikov - threatens those who fail to meet arbitrary arrest quotas at protests with salary and bonus cuts. When OMON forces are at a protest, they say, they have strict orders to seize and destroy all signs or banners saying “anything bad about the Interior Ministry, Medvedev or Putin,” and there is a standing order to detain public figures like Limonov.

So could this investigative report kick-start Interior Ministry reform or introduce a softer touch from the police in dealing with demonstrations? Masha Lipman, a political analyst at the Carnegie Moscow Center, was skeptical. First of all, a change in tactics would look like a “victory” for human rights groups, and the government is not keen to concede the corresponding defeat, she said. Nor does she believe government policy is responsive to the public opinion fomented by the small islands of independent media like the New Times.

To that extent, police heavy-handedness is likely to continue. Lipman said the government’s overall aim was to discourage opposition groups from demonstrating in the capital, rather than specifically intimidating them. She pointed to the arrest amnesty that Alexeyeva currently enjoys at protests as an example.

“But looking at it rationally, as an outside observer, it seems truly unreasonable. The protests were small – the latest was bigger than the previous one, but even that was small and according to those present, 100 of them were journalists. This is not a real threat – in fact if the authorities had let them get away with it, it would have been less of an event and there would have been precious little to cover,” said Lipman. But the stakes are still too high for the government to risk a lighter touch, she said. “However tiny the risk, they want to hedge themselves against it,” said Lipman.

“The regime does not want there to be an opposition that can really take action on the streets of the capital or St. Petersburg,” agreed Orlov. “They think it’ll start out with 100 people, the next time there will be 1,000, and then there will be 10,000, just like in Kaliningrad,” he said. As many as 12,000 people protested in Kaliningrad last Sunday against rising transportation tax and utility price hikes in the Russian exclave in Central Europe. And although demonstrators were calling for Prime Minister Vladimir Putin’s resignation, the event passed off peacefully.

“They prefer to look stupid at these protests, sending more police and riot police along to them than there are protesters, arresting all these people – they prefer to look like that than to allow the number of people at opposition meetings to grow,” said Orlov.

The next demonstration in defense of Article 31 will take place on March 31