Russian tycoon to return stake in Strabag

Embattled Russian billionaire Oleg Deripaska will return his 25% stake in Austria’s Strabag construction company to its shareholders, Deripaska’s Basic Element holding company told the Moscow Times on Monday. One of the biggest Russian casualties of the global economic crisis, Deripaska is estimated to have lost $25 bn (EUR19.12 bn) of his fortune over the past year as his business empire came under intense financial pressure.

Under a deal to be signed this week with Strabag’s shareholders, Deripaska will transfer his stake while retaining one share and two seats on the supervisory board. Deripaska has the option to buy back the shares by the end of the year.

Deripaska took out a EUR500 mln loan from Deutsche Bank two years ago to acquire his stake in Strabag. The loan was refinanced by Strabag’s shareholders last year, and Deripaska’s stake was provided as collateral. Strabag spokesman Christian Ebner said Deripaska voluntarily surrendered the stake, and will remain a shareholder in the company.

The tycoon aggressively expanded his business, which ranges from metals to car manufacturing, in the boom years, taking out huge loans backed by collateral in his companies. But as credit markets dried up and stock markets crashed around the globe last fall, he was forced to cede stakes to creditors in Canadian automaker Magna and German house builder Hochtief. Deripaska also owns a 25% stake in mining company Norilsk Nickel and a stake in GAZ, the troubled car manufacturer that owns British van-maker LDV, along with construction firms that play a vital role in preparing facilities for Sochi’s Winter Olympics in 2014.

Strabag has already benefited from the partnership with Deripaska, winning a tender last year from Basic Element to expand and modernise Sochi’s international airport.

The Kremlin extended Deripaska a $4.5 bn bailout last autumn to repay lenders, but has indicated it has little appetite to lend more money to overextended businesses.