In late November, the US President-elect Donald trump has officially named the candidate on a post of the Minister of Commerce in his administration. Is Wilbur Ross, 79-year-old American billionaire, economic adviser to trump during the presidential campaign, the investor and the banker, a specialist in crisis management, which has long been known in Russia.
His fortune ($2.5 billion and $2.9 billion, according to estimates on December 5, Forbes and Bloomberg, respectively) Ross earned on bankruptcies. He entered the capital of troubled companies, and by restructuring the business, returned them to profit. Because of this the tactics of corporate America gave him the nickname the King of insolvency (King of Bankruptcy).
Investments in distressed assets, Ross started in 1997, when the site of Rothschild has created a special investment Fund. The capital of the Fund amounted to $200 million With the deterioration of market conditions resulting from the overheating of the economy in the late 1990s, Ross has decided to change their focus and to increase investment activity, gradually moving away from consulting. Conditions for this were optimal. The company went bankrupt by the hundreds — from the flagships of the new economy, such as Enron, WorldCom and Global Crossing, to heavyweight materials sector, losing the global competitive battle and are not able to optimize financial and operational resources. The laws of the United States bankruptcy code, at the time of taking troubled companies some financial obligations to those returned to profit, making such assets more attractive to investors.
In 2000, the 62-year-old banker, bought from Rothschild, the investment Fund, and established a private investment WL Ross. In it the businessman managed to raise $440 million In the company in addition Ross includes four of the top Manager.
In 2006, Ross sold the business to investigate Amvescap (now Invesco) for $375 million, but remained in the management of the Fund. By 2014, under the management of WL Ross was a capital of $7 billion Ross remains Chairman and a Director of the company on strategic issues.
Look at Russia
In 2004 Ross, two years earlier, bringing together various metallurgical plants in the second size and the first in the efficiency of steelmaking company in the United States — International Steel Group, look to the steel assets in Russia and other countries. About this he told in an interview with Bloomberg. According to the businessman, it allowed him to expand the customer base of the Corporation. “We could start with Russia, — says Ross. — It would be a logical solution. We are very interested in the activities of some Russian companies.”
In June 2016, commenting on the possible consequences of a British exit from the EU a few days after it reopened, Ross said that Brexit could start the process of weakening the anti-Russian sanctions of the block.
It is unclear when trump was personally acquainted with Ross; their business paths could have crossed paths back in the 1980s. Then trump was in a difficult financial situation. The real estate market in new York city dipped shortly after the billionaire finished the expansion belonging to the hotel chain Resorts International. Lenders included in the network three casino Trump Taj Mahal sought restructuring of the business in particular, has insisted on from the brand was expelled last name trump. Then the position of Ross, which has served as financial Advisor to the creditors, helped the Tramp to keep the brand and save the business. “The name trump attached this casino extra cost”, said Ross.
Despite the fact that Ross was raised as a Democrat, his business expertise and worked on the Republicans. Held between 1994 and 2001 the mayor of new York Rudolph Giuliani appointed Ross as his adviser on privatization. In this post, Ross helped the city to privatize TV and radio stations, port assets, and also sold a lot of building plots.
An expert on Russia
In the 1990s, Ross advised the Clinton administration on issues of us-Russian trade and also served on the Board of the us-Russian investment Fund TUSRIF. The Fund was established by the US administration in 1995, with the help of the U.S. Agency for international development (USAID) to organize investments in the Russian economy. TUSRIF invested primarily in media, consumer goods, retail, financial services, information technology and telecommunications. In the 17 years of its operation, the Fund has invested in Russian companies more than $1 billion, follows from the materials of the Fund.
Management of the Fund involved in the company Delta Private Equity (formerly Delta Capital Management), headed by Patricia Cloherty. In 2008, she from the hands of Vladimir Putin has awarded the order of Friendship for his “great contribution to strengthening friendship between Moscow and Washington.” In 2004, the managed Fund of the Russian DeltaBank for $150 million bought American General Electric (the Bank was renamed as “GE money Bank”, in 2013, purchased by Sovcombank). In 2005, another Russian Fund, the Bank “DeltaCredit” over $100 million have acquired French financial group Societe Generale.
Both transactions were prepared by Kirill Dmitriev, who is now Director General of the Russian direct investment Fund, which was first the chief investment officer and then managing Director and partner of Delta Private Equity, follows from the information on the website of the FUND. In 2011, as head of the RDIF, Dmitriev prepared presentation Foundation in new York, brought together a dozen asset managers in the amount of almost $2 trillion. Among the participants of the meeting were Ross. In his comments to the Financial Times last month Dmitriev said that the inclusion in the new US administration people like Ross, heralds improved relations with Russia. “Like [Ross] would be useful for business, as business like the entrepreneurs who worked in top positions and achieved success,” — quoted by Dmitriev FT. At the time of delivery of the material Dmitriev noted on the request .
Skilled nursing home
Wilbur Louis Ross Jr., was born November 28, 1937 in Weehawken, new Jersey, in the family of a lawyer and a teacher. The boy attended a Jesuit preparatory school Xavier High School in Manhattan. Was in team of the school shooting, which partially lost their hearing.
In 1959, Ross graduated from Yale University with a bachelor of arts degree in 1961 from the Harvard University with a master’s degree in the MBA program. From 1976 to 2000 he worked at the investment Bank Rothschild, specialising in crisis management and business restructuring. Be a recognised expert in this field. The glory of Ross as a financier brought him success in the improvement of the enterprises American coal and steel industry in 2000-ies. According to Bloomberg, since 2000, Ross has in total invested in 178 companies, being able for them to attract $11.9 billion of capital, these transactions have enabled the Fund to earn billions of dollars. Its portfolio of distressed transactions in excess of $400 billion, according to the website of Ross on the website of Yale University.
Ross is the only businessman, whose name is immortalized in the Hall of fame of private investors, and in the Hall of fame in sanator.
The Cypriot intermediary
With the Russian structures Ross worked and later, when he became Vice-Chairman of the Board of Directors of the Bank of Cyprus, the largest Bank on the island, where the group structure “Renova” Victor Vekselberg own about 10% (in 2013, the Russian customers of the Bank became shareholders as a result of compulsory conversion of deposits into shares due to the financial crisis). Until may 2015, together with Ross in the Council worked with Vladimir Strzhalkovskiy, who comes from the KGB and from 2008-2012 held the post of Director General of “Norilsk Nickel”. Strzhalkovsky and Ross had maintained friendly personal relations have often taken a common position on various issues of the Bank’s activities, gave Strzhalkovskiy through a representative. According to Strzhalkovsky, Ross is a very experienced, well-versed in the trade specialist, a major investor. “The attitude towards Russia on the part of Mr. Ross have always been good, no bias against the country or against Russian businessmen I’ve ever felt,” — says Strzhalkovsky. In 2015, the Bank of Cyprus came out of the Russian assets, but “the reduction in operating activity in Russia was not associated with the arrival of Mr. Ross, by coincidence,” says Strzhalkovsky.
The Board of Directors of the Bank came in and Maxim Goldman, Director of strategic projects “Renova”. According to Goldman, Wilbur Ross gives the impression of a very thoughtful, knowledgeable and experienced investor and has a huge capacity for work despite his age. “Several times Ross participated in meetings on the phone, when the US was deep night, but asked very clear and the right questions,” recalls Goldman. To the output of the Bank of Cyprus from Russia, he has no direct relationship, it’s just a coincidence that this decision was taken during his membership in the Board of Directors, confirms a top-the Manager.
Problems in Russian-American trade
Russia takes the 37th place among export markets of the USA and the 24th place among suppliers of goods to the American market.
The largest share in the structure of the American export to Russia in 2015 took transportation equipment — 36,3%, follows from data of the U.S. Department of Commerce. In second place — machinery (except electric) with a share of 19.2% in the third — chemical products (13.3%), and the fourth — computers and electronic products (10%).
In the structure of Russian imports in the U.S., according to 2015, the largest share of 47.3% is oil and coal. Followed by the production of primary metals (21%), chemical products (14.8 per cent), oil and gas (4,5%). In 2015, exports of petroleum products and crude oil from Russia to the United States increased by 15 million barrels., up to 135 million barrels, according to the U.S. Department of energy.
Despite sanctions and a General cooling of relations between Russia and the United States continues to trade in sensitive goods. Classified exports from Russia to the USA in 2015 has increased by 78% to $456 million reported earlier. State “Techsnabexport” on contracts up to 2020 supplies enriched uranium to several U.S. nuclear operators, including the largest generating company in the United States Exelon.
Due to sanctions by the Ministry of Finance and the U.S. Department of Commerce restricted exports to Russia U.S. oil and gas technologies and dual-use goods. In addition, there are anti-dumping duties on Russian cold-rolled steel, imposed in March 2016, the U.S. Department of Commerce, Bloomberg reported. Against Russian fertilizers (ammonium nitrate and urea) in recent years also operated the American protective duties, some of which were filmed in August 2016.