Waiting for relief
“Biomass” and “aggressive porridge” were called by Russians living in London businessman Eugene Chichvarkin in an interview with “Echo of Moscow”.
“Most [Russians] have enough slavish consciousness. This can be changed. Having disobeyed anyone, having seized parliament and having shown will, to say: “Now [it will be] so. You are underdeveloped, here are the new rules for you, ”London sponsor Alexei Navalny reasoned about his view of the“ beautiful Russia of the future ”.
Chichvarkin, he said, could have returned to Russia if people close to him in his views seized power. However, the UK, in his opinion, "is not a bad country."
However, in response to the question of what is happening with the business, Chichvarkin hesitates.
“Business is half alive. Only delivery works. The restaurant is alive at 10%, because only delivery. We are waiting for concessions, ”he admits.
The entrepreneur probably meant that the difficulties are associated with the epidemic of coronavirus and quarantine. But this is not so. His problems started much earlier.
RT studied the financial statements of all London companies controlled by Chichvarkin and his second wife, Tatyana Fokina, and concluded that their financial situation was close to critical two years ago.
In particular, British independent auditors expressed doubt about the stability of his companies.
Their findings are contained in the reports of two major Chichvarkin firms - Hedonism Drinks LTD and 85 Piccadilly LTD. They are part of the same group and operate the Hedonism Wines liquor store, as well as the Hide Restaurant, which opened in 2018. The parent company is Hedonism Drinks.
All of them are located in the prestigious district of London - in Mayfair. Hedonism Drinks LTD and 85 Piccadilly LTD - on Mount Street, a wine store - on Davis Street, Hide restaurant - on Piccadilly, 85.
There are three leaders in the Hedonism group of companies: Chichvarkin himself, his wife Tatyana Fokina, and a longtime friend - co-founder of Euroset Timur Artemyev.
Lingering uncertainty
The first report was published in July 2019 in the register of British companies Companies House. Due to the nature of British accounting, documents reflect financial activities for the period from August 2017 to August 2018. There is no more recent data in the public domain.
In this report, reviewer James Creston noted the presence of “significant uncertainty regarding the going concern” of the group of companies.
The auditor is not sure that the company will remain financially stable in the future. His doubts are connected with the fact that the debt obligations of the group of companies exceed £ 1.5 million of its assets. The size of assets (fixed assets) is £ 18.7 million, the size of liabilities is £ 20.2 million. That is, it is not able to repay all claims of creditors at the same time.
In addition, in 2018, Hedonism Group posted a loss of more than £ 152 thousand, while a year earlier it earned £ 1.62 million in net profit.
According to the auditor, since Chichvarkin personally gives them a substantial part of the funds out of pocket (more on this below), the companies will survive until he runs out of money.
However, in public speaking, the businessman was optimistic. So, in an interview, he spoke about the positive dynamics of his enterprise.
“We have had steady, consistent growth for all four years,” he noted.
Costly Shelter
The reason for such a substantial financial loss was the opening of a two-story Hide restaurant by Chichvarkin. In this, Hedonism Drinks is recognized in its own business review.
For this restaurant, Chichvarkin invited the titled chef, owner of the Michelin star Olli Dabu.
To open his restaurant, Chichvarkin needed serious investments. As The Evening Standart wrote, investments in this enterprise could amount to £ 20 million.
This figure echoes the accounts of the operating company of the restaurant 85 Piccadilly LTD, according to which the cost of fixed assets is £ 15.3 million. This includes equipment, improvements (repairs), computers and a long-term lease building.
The directors of the Civil Code recognized then that the restaurant had not yet become profitable. They had to support him with funds from their pocket.
“The parent company will continue to support the restaurant business until it becomes a profitable enterprise in itself,” the report says.
The Hedonism Drinks Group itself is "financed only by its shareholder and therefore is highly dependent on further financial support."
“The shareholder has promised that he will continue to provide support until the subsidiary becomes profitable,” the document emphasizes.
The directors of the companies Chichvarkin, Fokina and Artemyev, despite the significant costs of opening the Hide restaurant, received £ 467 thousand in 2017-2018. This is £ 164 thousand more than their salary in the previous financial year.
- © hide_below
Lender to himself
As already mentioned, as of July 31, 2018, the Hedonism Drinks group of companies, according to the report, had assets worth £ 18.7 million.
This includes rented real estate (obviously, a store and restaurant building), equipment, cars and computers.
The total obligations of Hedonism Drinks with a maturity of one year amounted to £ 37.8 million at the time of reporting. That is, they had to be repaid in September 2019. At the same time, Chichvarkin himself lent his enterprise £ 31.2 million.
Hedonism Drinks Group of Companies owed £ 5.6 million to various banks, of which £ 1.4 million had to be paid within 12 months. One of the loans, as follows from the reports, was taken to modernize the restaurant.
Companies also bear the burden of operating lease payments (for the use of certain assets, equipment without ownership). For five years, Hedonism Drinks will have to pay another £ 18.8 million for this expense item.
Thus, Chichvarkin companies accumulated debts with different maturities in the amount of £ 60.8 million.
Chichvarkin assured the auditor that he would not require his company to repay the debt in the near future.
“The shareholder pledged not to demand repayment of the loan for at least 12 months from the date of signing the balance sheet,” the report says.
To lend to himself is not Chichvarkin's know-how. Similarly, as RT already found out in his own investigation, the oligarch Mikhail Khodorkovsky, now living in London, comes with his controlled companies.
Friendly companies or the founders themselves, those who will not take money back, often become borrowers.
As RT lawyer Anatoly Verbitsky, who specializes in bankruptcy, told RT, business owners sometimes arrange loans to their firms so that in the event of bankruptcy they themselves become the first in line for debt repayment.
“In the event of a bankruptcy of a company, obligations to creditors are paid off first of all, to owners and investors - to the last,” the lawyer explained.
But there may be another reason, the expert adds: it is easier to go bankrupt.
“If for some reason Chichvarkin goes bankrupt himself, it will be much easier for him to do this when the main borrower is himself, not banks,” the lawyer said.
As RT found out, on January 13, 2020, Metro Bank and Chichvarkin in the presence of his personal assistant Ekaterina Tereshkina signed a property pledge agreement.
Perhaps the current situation with loans forced Chichvarkin to lay down his premises on the leasehold (long-term ownership, rent, usually for a period of 99 to 125 years), the premises of the Hide restaurant on ul. Piccadilly.
- globallookpress.com
- © Gustavo Valiente / ZUMAPRESS.com
You can’t forbid to live beautifully
The amount of the transaction for the sale of Euroset, which Chichvarkin concluded with Alexander Mamut in ANN in 2008, amounted to $ 350 million - £ 189.9 million.
However, he seems to be running out of opportunities to borrow his own London business.
The businessman shared this money equally with the company's co-founder Timur Artemyev - at $ 175 million (£ 95 million).
After moving to London, Chichvarkin and his wife Antonina bought a house in Surrey for £ 9.95 million, next door to fugitive oligarch Boris Berezovsky.
According to Zoopla.co.uk, which monitors property prices, maintaining a home worth £ 9.5-10.5 million in Surrey county costs an average of £ 38.3 thousand per month (£ 460 thousand per year).
According to some reports, in 2014 Chichvarkin acquired another house in central London at a cost of £ 6.75 million, the content of which per year, according to Zoopla, could cost £ 120 thousand.
If we assume that Chichvarkin did not make more substantial expenses, then by 2016, when he divorced Antonina, he had about £ 74.9 million left.
Divorce cost the businessman half that money.
“When selling Euroset, Rodina depreciated 75% of the company, then we shared with my friend and partner Timur 50/50, then during the divorce we shared 50/50 with my ex-wife,” he wrote in his Forbes column in 2019 .
- © tot_samy_chichvarkin
Thus, Chichvarkin could have left £ 37.5 million. Of these, as follows from the above reporting data, he lent his own company Hedonism Drinks without interest at £ 31.2 million. They have already been put into circulation, and it is not known when they will return and whether they will return in principle.
The remaining amount of £ 6.3 million is only 3.3% of the money that he and his partner earned in 2008 from the sale of Euroset.
However, Chichvarkin himself admits: “As a result, there are not so many left. There is money, but everything is in stock, and there is practically no cash turnover here. ”
Spy for a businessman
Assistant Chichvarkin Tereshkina mentioned above is not accidental. According to the British company registry of Companies House, it directly or indirectly has a casting vote (75%) in the Anti-corruption Libertarian Fundraising Limited.
Chichvarkin created this fund to support Alexei Navalny. In November 2019, a businessman announced on his Instagram the creation of this fund.
“We, here in England, are also not idle, not waiting, but getting ready: we have created a fund to fight corruption and support libertarian initiatives. As soon as the accounts are opened, it will be very convenient for everyone who lives abroad and who is uncomfortable transferring money to Navalny FBK or to libertarians directly, ”he wrote.
The ex-owner of Euroset repeatedly stated his sympathy for the opposition and publicly reported on the transfer of at least 400 thousand rubles through PayPal to FBK.
The main recipients were Leonid Volkov and Vladimir Ashurkov - FBK Executive Director, who is also hiding from Russian justice in London.
Chichvarkin said in an interview with NTV in May 2019 that he also acts as an intermediary for the transfer of money to Alexei Navalny.
“[People] are transferring money to me, who are afraid to transfer directly to [Navalny],” he said.
According to the businessman, on average, up to 100 thousand rubles a day were transferred through him in different currencies - yen, pounds, euros.
Perhaps, it was for these purposes, including the creation of the same name with the FBK * Navalny Fund.
He was led and became co-owner by 29-year-old Ekaterina Tereshkina, personal assistant to Evgeny Chichvarkin (now the businessman himself is listed as the director of the fund). In an interview with Zima, she said that after graduating from Moscow State Linguistic University, she was taken to the FSB Academy to teach English. She worked there for a year and a half, and all this time she was “not allowed to travel abroad”, that is, she could not leave the country.
Judging by the status of "travel abroad", Tereshkina for the period of work could assign a certain level of tolerance for secrecy - that is, she could have access to classified information.
In the UK, Catherine entered the marketing department at the University of Exeter business school in Devonshire. She got a job at Hedonism Drinks about four years ago.
Chichvarkin, she said, seriously took an interview with a former employee of the FSB Academy, was she a spy applicant?
One way or another, but the London FBK, under the leadership of Tereshkina, lasted only a few months. On February 25, 2020, a notice appeared in the register of companies about the beginning of its liquidation procedure. What is the reason for this is unknown.
Political scientist Leonid Degtyarev believes that Navalny’s foreign sponsors might be afraid of Tereshkina’s ties with Russian intelligence agencies.
“Western sponsors also heard that there are no former security officials,” Degtyarev ironically said in his video posted on Twitter.
The fate of the hedonist
With the outbreak of the coronavirus epidemic, the Hedonism business, like any other in London, had to change the format of work. The restaurant and the store switched to home delivery, and Chichvarkin himself is now joking on Instagram, showing indecent gestures for a negative coronavirus test.
March 25, 2020, the day after the introduction of quarantine in London, Chichvarkin confidently said that he was not afraid of crises.
“Any financial or banking crisis is real ** with this business. I absolutely do not care if a whole superpower goes broke. I don’t care, oil is 10 or 200 [dollars]. Anyway, who has the money. It was a thoughtful step. The fact that [business] does not grow six times as the Euroset has grown doesn’t grow. We have had steady, consistent growth for all four years, ”he said.
This happened after the businessman mortgaged his restaurant to Metro Bank. And now, as noted above, he is no longer so optimistic. And in combination with multimillion-dollar debts and, presumably, a balance of £ 6.3 million of personal funds, it is possible that in a couple of years hedonism as a lifestyle can not afford an entrepreneur.
* The Anti-Corruption Fund is included in the register of NGOs performing the functions of a foreign agent, by decision of the Ministry of Justice of the Russian Federation of 09.10.2019.