Media-Shy Oligarch Enters Limelight

VedomostiRodionov Publishing House, which prints Profil, is half-owned by Iskander Makhmudov and a business associate.
Media-shy billionaire Iskander Makhmudov has paid an undisclosed sum for a 25 percent stake in the Rodionov Publishing House, the company said Wednesday.

Though signed in September, the deal did not become public until Wednesday, when Vedomosti cast the little-known metals magnate into the limelight.

Rodionov confirmed that Makhmudov acquired the stake and that his business partner and longtime friend Andrei Bokaryov took another 25 percent stake. Both were unavailable for comment.

"At the end of last year, they came here as strategic investors. From the very beginning they said they were interested in the business as it is and were not going to interfere in our editorial policy," Alexei Volin, Rodionov's general director, said in a telephone interview.

The magazine publisher owns five titles, including the news weekly Profil, which is published in cooperation with BusinessWeek.

Notoriously publicity-shy Makhmudov, 41, was ranked as the country's 18th-richest man -- worth $2.2 billion -- by Forbes Russia. Makhmudov, a native of Bukhara, Uzbekistan, began his professional life as a military translator of Arabic in the 1980s. He now owns Russia's No. 2 copper producer, Urals Mining and Metallurgical Company, and mining giant Kuzbassrazrezugol, of which Bokaryov is the board chairman.

Asked why the deal was never announced, Volin said it was nothing more than a "porfolio investment," not a buy-out. "They are spending money for the development of our business. After several years they can sell their stake or maybe go public. In any case, they're making a profit," Volin said.

Analysts expressed surprise at the deal, since it was Makhmudov's first foray into the media business.

"The publishing market is growing very fast, although it's less profitable than any extraction or manufacturing industry," said Konstantin Isakov, general director of Mediamark market research agency. "But is more prestigious."

The deal became public less than a week after Gazprom Media, a subsidiary of state-controlled Gazprom, said it was buying a controlling stake in Izvestia from billionaire Vladimir Potanin's Prof Media. The move raised fears the Kremlin would influence the paper's coverage.

Even though he has been trying to establish relations with the siloviki -- former security and law enforcement officers who have followed President Vladimir Putin into the Kremlin -- Makhmudov's connections to the government are unclear, said Alexei Mukhin, director of the Center for Political Information and the author of several books on Kremlin political clans.

In the 1990s Makhmudov was said to be close to former President Boris Yeltsin's inner circle, Mukhin said, "but today I wouldn't classify Makhmudov as particularly well-connected in the Kremlin."

Publisher Volin dismissed the suggestion that the Kremlin might be ultimately behind the purchase or was influencing Rodionov's editorial policy.

"You can read Profil magazine, our chief publication at the moment, and I think it would be very difficult to find anything which is pleasant for the Kremlin," he said.

The company is worth about $25 million and had advertising revenue of some $14 million last year, Volin said.

It is planning to launch the Russian version of BusinessWeek in September.