Deputy Governor of Dnipropetrovsk oblast Hennadiy Korban harbors plans to nationalize the Ocean Plaza Mall

Photo: Konstantin Melnitskiy

Deputy Governor of Dnipropetrovsk Hennadiy Korban assured that he will take revenge for the nationalized assets in Russia and Crimea. “There has been some rumor in the Internet that Korban called the director of the Ocean Plaza shopping mall owned by the Rotenberg brothers (Arkady and Boris Rotenberg) Russian oligarchs and members of the inner circle of Russian President Vladimir Putin – Capital) and suggested that he gave up. I would like to confirm. There was such a call. Moreover, it will not end with the calls. There will be no rest for us for as long as Russian invaders rob our land and our government remains silent,” said Deputy Head of the Dnipropetrovsk Oblast State Administration Borys Filatov wrote on his Facebook page.

Korban refused to talk to Capital and Filatov confirmed that he actually wrote the above-quoted message on his page. He said that Korban asked the managers of Ocean Plaza to present constituent documents, thereby confirming that the center does not belong to Russian owners. “But they refused to present the documents,” he stressed.

Sanctions Ukrainian-style

Filatov explained the plans to nationalize the shopping mall with a response to the confiscation of his, Korban’s and Ihor Kolomoiskiy’s assets in the annexed Crimea. “They took from us the Enerhetyk Recreation and Retreat Center, the Crimea Hotel and some land plots. We did not assess the amount of losses,” said Filatov.

On September 3 Capital reported that the State Council of Crimea nationalized 82 facilities formerly owned by Kolomoiskiy. The list includes non-residential premises, which previously housed branch offices of PrivatBank, as well as facilities owned by the financial institution, recreational facilities, a tank farm, the Krymzalizobeton Plant and 32 gas stations (Ukrnafta, Sentosa Oil, ANP and Avias). On September 10 five land plots in Foros with a total area of over 66 hectares were added to the list.

De facto Premier Crimea Sergey Aksyonov explained that the property of the Dnipropetrovsk governor would be sold at an auction and the money will be used to compensate for deposit of Crimean residents in PrivatBank. Aksyonov accused the owner of the Privat Group and PrivatBank of not returning the money to its investors.

In early September the Investigative Committee of Russia arrested an office building in Moscow owned by Elite-Holding, whose co-founder is the governor of the Dnipropetrovsk oblast. “The building is arrested “to block the financing of terrorist activities and other criminal acts against the civilian population of the southeast of Ukraine,” says the report of the Investigative Committee of Russia. In response Kolomoyskiy said he would lodge a complaint against Russia with the Hague Tribunal demanding to compensate losses of US $2 bn.

The Financial Police, which reports to the Ministry of Economy and Finance of Italy, has frozen the assets of Arkady Rotenberg: an apartment, four villas, as well as the Berg Luxury Hotel in Rome, reported the Italian newspaper Corriere della Sera at the end of September. The value of those assets is estimated at EUR 30 mn.

The largest center

Representatives of the press service of TPS Nedvizhymost Kiev, which manages Ocean Plaza, confirmed that an individual who introduced himself as the Deputy Governor of Dnipropetrovsk oblast called the company’s management. “He suggested that the Ocean Plaza Shopping Mall was owned by Russian citizens and had to be nationalized. He did not specify any legal arguments or reasons for nationalization,” says the company’s written response to Capital’s request.

In addition, it was mentioned in the letter that the mall belongs to a Western European company composed of managers from the UK. “No sanctions were applied to the company and among its beneficiaries there are no individuals named in sanction lists passed in connection with the situation in our country,” explained representatives of TPS Nedvizhymost Kiev.

The Ocean Plaza Mall is the largest shopping center in Kyiv. Its trade area is 72,000 sq. m. In 2012, the UDP and private investors sold the center to TPS Nedvizhymost Kiev for US $300 mn. The founder of K.A.N. Development (a company involved in implementation of the project) Ihor Nikonov said that contrary to rumors TPS Nedvizhymost does not belong to the Rotenberg brothers.

Legal nuances

We have the mechanisms by which it is possible to nationalize Ocean Plaza, says Filatov. “But I will not name them,” he added. The founder of the TEKT Investment Company Vadym Hryb said it is possible to recognize the sale of the shopping center of TPS Nedvizhymost, but for that it should be disputed either by the buyer or the seller. “For example, Kolomoiskiy’s team may represent interests of the seller,” he said.

As a reminder, the current Deputy Governor of Dnipropetrovsk Oblast Hennadiy Korban has a shady reputation since 2000. His name is associated with the change of ownership of many assets – the Kalinin Coke Plant in Dnipropetrovsk, Ukrtatnafta and others. Many changes in ownership were accompanied by high-profile scandals and litigation. Korban himself repeatedly referred to himself in the media as an expert in corporate conflicts. But none of the experts, who talked to Capital, could recall a case when Korban announced his actions in social networks. The general public only learned about the change of ownership in its process, post factum, but never in advance.

There are a number ways to gain control of the Ocean Plaza Shopping Mall, says a partner at the Ilyashev and Partners Law Firm Maksym Kopeychikov. One of them would be opening a criminal case on any matter to which the facility could be linked as a piece of evidence or apply the seizure of property with the prohibition of its use. If the facility is declared a piece of physical evidence, it will be theoretically possible to convey ownership of the center to legal persons other than the owner. Moreover, it is impossible to rule out the possibility that those would not be Kolomoiskiy’s people.

Another option is putting pressure on the managers of Ocean Plaza for the purchase of the mall at a lower price. “Based on the fact that certain information has already been planted in the media, pressure is already being applied,” the expert concludes.