Alexey Mordashov: Bio, Net worth, Career, Investments

Ranked 48 on the Forbes 2019 billionaire list, Alexey Mordashov, a Russian business magnate and investor is the former CEO and majority shareholder at Severstal, a steel, mining, and energy company. He is a part-owner of the TUI Group owning about 25% of its stakes.

Net worth

$19.7B as of May 27, 2020.

 

Early Life and Education

Alexey Alexandrovich Mordashov was born on 26 September 1965 in Cherepovets, Russia. Like most of his billionaire counterparts, Mordashov’s career path was also influenced by his parents who were steel mill workers which in turn influenced his choice of University. He enrolled at the Leningrad Engineering-Economical Institute University of Northumbria (ENGECON) where he graduated with a degree in economics. In 2001, he graduated from the Northumbria University, Newcastle where he bagged an MBA.

Career path

After graduating from ENGECON, Mordashov secured a job with Cherepovetskiy Metallurgical Plant, the same steel mill his parents worked. His career kicked off in 1988 where he worked as a senior economist, and by 1992 he had become the company’s Financial Officer; the company was made private in the same year.

Mordashov used the opportunity of owning multiple shares in the company after one of its early directors had asked him to acquire shares of the company to keep outsiders out. Moradshov took a good swing at the opportunity by retaining a good percentage of the shares for himself. He also bought off other workers' shares in the company, thereby, increasing his stakes in the company. With the money, he had saved he created two investment funds. In 1996 he was made the company’s CEO. After his appointment as CEO of Cherepovestiky Metallurgical Plant, he created the Severstal Group which deals with steel, coal, and mining operations as an upgrade for the state-owned Cherepovets Iron and Steel. This happened in the joint-stock company agreement.

In 2002, he occupied the role of CEO of the new group, Severstal until 2015 when he stepped down from the position and was elected chairman of the board of directors. It wasn’t until 2004 that Mordashov expanded the company’s operations beyond the Russian shores. The company gained access to the U.S. market by acquiring and investing in American owned/based steel and purchasing companies. The company’s first acquisition was the Rogue Plant situated at Dearborn which came about as a deal between the Russian company and the United States Department of Energy was drawn. The deal was to have Mordashov’s company renovate the steel plants in Dearborn with a loan worth $370 million; however, the deal was struck out due to political clashes between both countries. On cancellation of the deal which only lasted ten years, Mordashov sold off his U.S. investments to the Renco Group at $2.3 billion.

Severstal

Under the leadership and management of Mordashov, Severstal has since become the largest steel manufacturing company in Russia with an employee count of 50,000. Its industrial facilities can be found in Russia, Ukraine, France, Italy, Kazakhstan, and some parts of Africa. In 2004, a new unit was launched at the Severstal Group—the Severstal North America which was in charge of the company’s business with its steelmaking assets acquired from Rogue Steel located in Michigan, USA. By 2006, the company was listed on the London Stock Exchange after becoming public once more prior to its initial privatization as Cherepovestiky.

The Group also owns the Severstal Cherepovets, ‘a professional ice hockey club’ and the Severstal Air Company amongst its other acquisitions and operations. 

 

Investments and acquisitions

Mordashov invested a total of $3 billion within a space of ten years (2004 – 2014) in two America owned steel manufacturing plants, Dearborn and Columbus. Currently owning 25% of the TUI stakes through his S-Group Travel, Mordashov first made an investment in TUI Travel in 2007 after which he gradually increased his shares in the company until he became the largest single shareholder. By 2016, he became a part of the TUI supervisory board. He owned yet another 25% stakes Siemens’ Power Machines a manufacturer of steam turbines. Mordashov also co-owns 50% stakes in Tele2, the fourth largest mobile operator in Russia. Several other investments and acquisitions have also been made via Severstal which include;

●     The Sevegral joint venture by Severstal (75%) and Arcelor (25%) – April 2006 (and later acquired Arcelor’s 25% in 2007)

●     Carrington Wire, British wire manufacturer- April 2006 (closed in 2010)

●     Lucchini (Severstal acquired a controlling stake) – October 2016 (and an additional 9% by 2007)

●     Celtic Resources, a gold mining company – February 2007

●     Aprelkovo and Nrungri Metallic, gold mines located in Russia - October 2007

●     Sparrows Point, a steel mill located in Maryland, USA – May 2008

●     Mano River Resources, an iron ore deposit located in West Africa (controlling stakes) – May 2008

●     Esmark Inc located in West Virginia, USA – June 2008

●     WCI Steel Mill located in Ohio, USA – July 2008

●     Radaelli Tecna (acquired under Severstal Metiz) – August 2008

●     Gruppo Lucchini (acquired all the shares of the group) – March 2010 (50.8% of Lucchini SpA was sold to a subsidiary company controlled by Mordashov)

●     Crew Gold – January 2011

Roles and Positions

●     Vice Chairman- World Steel Association

●     Vice-president- Russian-German Chamber of Commerce

●     Head- Russian Union of Industrialists and Entrepreneurs’ Committee on Integration

●     Co-chairman- Northern Dimension Business Council

●     Co-chairman- Trade as a Global Driver

●     Member- Russian-German Workgroup (responsible for economic and finance related issues)

●     Member- Entrepreneurial Council of the Government of Russian Federation

●     Member- EU Russia Business Cooperation Council

Awards

●     Order of Honor

●     Order of Alexander Nevsky

●     Order of Merit of the Italian Republic