As with each Olympic Games, there has been an unprecedented amount of media frenzy surrounding the 2014 Sochi Winter Olympics. Asides from the athletes and the aspirant medals, the games and its organizers have been under great scrutiny in the media regarding political issues; security measures, policies towards gays and lesbians, and the work-in-progress facilities. There is, however, an additional, and perhaps more controversial topic unique to the 2014 Sochi winter games, setting them far apart from their predecessors; and it’s the record amount of money being poured into them.
Forbes Sports Money is reporting Russia has spent an estimated $50 billion, more than quadruple the preliminary $12 billion budget. The amount surpasses the heavily scrutinized summer events in Athens ($15 billion), London ($14 billion) and its predecessor, Beijing ($40 billion).
According to various reports, Vladamir Putin has long hoped that hosting the Winter Olympic Games in 2014 and the football World Cup in 2018 will showcase Russia’s power, however at what, and whose expense will these extraordinary events happen?
According to Forbes Russia, there are nine Billionaires (evidently Russia’s wealthiest) who have had the biggest roles in Sochi 2014. Representing a combination of individual spenders, sponsors and recipients of state contracts (funded by state money), here are the Billionaires behind the most expensive Olympics ever.
9. Vagit Alekperov, Contribution: $15 Million
Currently rated by Forbes Magazine as the fifth richest person in Russia, and the 55th richest person in the world, Vagit Alekperov is president of LUKoil, and employs more than 100,000 people. LUKoil is among the world’s most powerful oil companies. Alekperov’s subsidiary company Lukoil- EcoEnergo spent $15 million reconstructing the Krasnopolianskaya hydro-electric power station. While his investment is comparatively smaller than the others on the list, Alekperov has evidently been the picture perfect investor, staying in line with all project deadlines and budgets, and avoiding any controversy.
8. Andrei Bokarev, Contribution: $103 Million
Considered a new billionaire, Andrei Bokarev’s wealth is reportedly self-made, with the main source of his fortune deriving from coal mining and machine building. He currently runs Transmashholding, one of Russia’s biggest Russian machine building companies, a producer of rolling stock for railways and subway systems.
While Bokarev’s intention was to spend $60 million on a 7,000 seat Olympic ice skating arena, the total amount spent was closer to $103 million. While ownership of the arena will be transferred to the government free of charge in 2015, the arena will have an intricate part in the games, hosting Paralympics hockey and sledge-hockey tournaments.
7. Alisher Usmanov, Contribution: $227 Million
Alisher Usmanov built his wealth through metal and mining operations, as well as investments, and according to data collected from Forbes website 2013, the oligarch Usmanov ranks 34th richest in the world. As the main stakeholder of Megafon, Usmanov ensured the telecom giant signed a $130 million sponsorship contract with the Olympic Organizational Committee. He struck a deal which committed the company to provide $75 million in cash and the rest in mobile communications credit for the Committee, athletes, the press, volunteers, etc. Within a separate deal, Megafon additionally agreed to invest $97 million, entitling him to receive the rights to build accompanying base stations.
6. Viktor Vekselberg, Contribution: $500 Million
A Ukrainian born oligarch, Viktor Vekselberg is the main owner of the Renova Group, a Russian company primarily focuses on aluminum, oil, energy, telecoms. His success however, has not come without controversy, in April 2009 the Swiss Federal Finance Department began a criminal investigation against him focusing on securities violations. Vekselberg’s contribution to Sochi 2014 is said to be about $500 million, while 70% of the investments were borrowed from Russia’s Bank for Development and Foreign Economic Affairs. In 2013 the Renova Group’s, contributions include the opening of the Azimut Hotel Resort and SPA Sochi 4, Azimut Hotel Sochi 3, and a landscape park.
5. Gennady Timchenko, Contribution: $1.8 Billion
As one of the most powerful people in Russia and co-owner of the Gunvor Group, one of the largest international energy traders, Gennady imchenko and his two partners at SK Most Construction Company built the Adler-Alpica-Servis railroad. He is Chairman of Russia’s Kontinental Hockey League and president of the SKA St. Petersburg Hockey Club. Apparently SKA received an estimated $1.8 billion worth of state contracts in 2008, before Timchenko acquired a blocking stake in the company through his business structures in 2012. Timchenko has been quoted as saying he’s known President Vladimir Putin for years and maintains close relations.
4. Vladimir Potanin, Contribution: $2.5 Billion
Known as the fourth richest man from the Russia, and the 46th richest man in the world, (2012 Forbes listing) Vladimir Protanin was one of the original advocates of having the Winter Olympics in Sochi, and has invested $2.5 billion into the 2014 winter games. Coincidentally his company’s proposal for the games cost him $30 million. His initial plan was to spend $350 million on a modest ski resort in Sochi, but after Russia was awarded the 2014 games, he built the ski resort complete with 77 kilometers of trails in the mountains, as well as a snowboard park, a freestyle skiing center, one of the two Olympic Villages and the Russian Olympic University.
3. Oleg Deripaska, Contribution: $3.08 Billion
Oleg Deripaska is CEO of the largest aluminum company in the world, United Company RUSAL as well as the Russian Chairman of Supervisory Board of Basic Element Company and CEO and President of En+ Group. With a reported investment of $1.38 billion at Sochi, Deripaska and his companies refurbished the city’s airport, built the main Olympic village and constructed the Imeretinskiy freight port. In addition Deripaska received $1.7 billion in state contracts.
2. Arkady Rotenberg, Contribution:$7.36 Billion
Among the most influential businessmen in Russia, Arkady Rotenberg’s contribution comes in the form of various state contracts totaling $7.36 billion. The billions have contributed to everything from construction, to power plant development, new highways, and railroad tracks. Rotenberg has a strong connection to Putin; as a young boy, he used to play judo with the now Russian President. Today he is the first vice-president of the Judo Federation of Russia, and the “Dinamo” hockey team; his brother and partner, Boris, is president of the “Dinamo” soccer team, and Boris’s son Roman is in charge of business development for the St. Petersburg Hockey Club, SKA.
1. Iskander Makhmudov, Contribution: $8.79 Billion
Heading the stage agency Russian Railways, the general partner of the Sochi Games, Iskander Makhmudov is not well-known publicly. He has been described as the second-most-frightening and influential man in Russia after Boris Berezovskii. According to reports, Makhmudov wholly funded the Shayba ice rink, where the figure skating competitions will be held. The rink cost $98.5 million, making it more than one and a half times more expensive than other Olympic equivalents.
His powerful train and freight company was responsible for laying down the Adler-Krasnaya Polyana rail-and-motorway, built to ferry people to and from the games. The construction which disrupted the villagers’ water supply from 2009 onwards, estimated to have cost $8.7 billion, making it more expensive than the total cost of the 2010 Vancouver Winter Games. According to Russian Esquire, the automotive portion of this transport strip might as well have been paved with Beluga caviar for that price.
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