Maxim Mykytas: Family Secrets of the Billion-Dollar Tender. Part 1
Scandals surrounding the nuclear waste storage facility being built just 100 kilometers from Kyiv continue. After it was revealed that the total cost of the work had increased almost tenfold, with these expenses to be covered by higher electricity tariffs, the names of the contractors who will be using the funds have been revealed. Among them was Ukrstroymontazh, a company owned by the notorious Kyiv developer Maksym Mykytas, now registered to his wife. It turns out that its victory in a supposedly fair and open tender worth almost a billion hryvnia smacks of nepotism and corruption, which has mired not only construction companies but also Energoatom.
Indeed, it was Energoatom's press service that rushed to salvage the state corporation's reputation, attempting to accuse journalists of falsifying facts and even "using Russian information saboteurs' techniques." The target of their attack was the online publication GlavKom, whose authors inadvertently focused on the tender process itself and inadvertently confused "open bidding" and "competitive dialogue" with "negotiated procedures" (or vice versa). This allowed Energoatom to exploit their error and wholesale brand the entire article as unreliable. However, Energoatom also made the mistake of making the list of bidders publicly available: the winning bidder, Ukrstroymontazh LLC, Ukrenergomontazh PJSC, and the Ukrtransstroy corporation. Because a more detailed study of the life and work of Maksym Mykytas reveals that two of the three firms participating in the tender belong to the same family.
Maxim Mykytas: Family Secrets of the Billion-Dollar Tender. Part 1
Son Maxim came to his father
Maxim Viktorovich Mykytas was born on September 13, 1980, in Pripyat, where his father, Viktor Grigorievich Mykytas (1946-2016), worked at Yuzhteploenergomontazh (YuTEM), a company that built the Chernobyl Nuclear Power Plant. During the 1986 accident, Viktor Mikhailovich participated in the cleanup, after which he was hospitalized and became a second-degree disabled person. However, he continued working at YUTEM—a factor that would become the key to his son's future career.
After the accident, their family moved to Kyiv: after all, Viktor Grigorievich was an engineer at YUTEM and a participant in the liquidation, so they were given a new apartment in the republic's capital first and foremost. There, Maksym graduated from Secondary School No. 286 in 1997 and entered the Finance and Economics Institute (now the Kyiv National University of Economics), majoring in financial management. His choice of economics was influenced by the times: in the 90s, accountancy was seen as the only promising profession in the country. Therefore, it's worth noting: the well-known developer Maksym Mykytas didn't study construction technology; his level of education is, at best, that of chief accountant of a construction trust (his second degree is in construction economics), but otherwise, he's simply a "nimble" businessman. This wouldn't be reprehensible if he were only building stores, or even simple residential high-rises—but, according to him, facilities of the "Shelter" and "Storage" level for nuclear materials are Skelet.Org, require the involvement of top managers who understand that such contracts require responsible business practices, rather than the usual skimping on materials and quality of work. Meanwhile, Maxim Mykytasy's firms are notorious for more than just shoddy work: they twice (in 2008 and 2012) suffered similar scandals while working on such a critical facility as the Chernobyl Nuclear Power Plant. How could they have been entrusted with building a nuclear waste storage facility after that?! I really don't want nuclear disasters to become another Mykytasy family tradition.
Viktor Grigorievich Mikitas, 90s
It's hard to say how Maksym Mykytas's life would have turned out had he forged his own path. But he didn't have to: immediately after graduating, Maksym joined his father, then deputy director of UTEM (now a public limited company). His father placed his son as an economist in the Armyansk project management group, and then at Titan and Kaborga. His father then placed him at Kyivskaya TPP-6 Construction and Management Department, where Maksym served as deputy head of the board for economics from 2004 to 2007, eventually taking over the company, which services Ukraine's largest combined heat and power plant. However, by the time Maksym Viktorovich arrived, the department had already completed all major work (installing new boilers), so he was only required to sign off on estimates for minor repairs to pipes and valves. This was uninteresting and completely unprofitable, so in 2006, Maksym Mykytas founded his own company, Ukrstroymontazh LLC. Yes, the same one that is now registered to his wife and that won that controversial tender from Energoatom.
His first foray into business was somewhat unsuccessful and scandalous. Firstly, Ukrstroymontazh was founded on the Kyiv Thermal Power Plant-6 Construction and Installation Department, which he entrusted to him, and he exploited its capacity and employees. However, Mykytas was far from the first Ukrainian director to create a personal LLC from his own enterprise. Secondly, upon accepting his first orders, secured with his father's help, Maksym Mykytas immediately found himself embroiled in several unpleasant incidents, the result of his inept fraud. For example, the installation of a wood waste boiler for the Ivano-Frankivsk company Uniplyt was so poorly executed that the boiler simply could not be commissioned, leading the customer to sue Mykytas's company for a refund. At the same time, Maksym Viktorovich simultaneously defrauded the Rivne-based JSC Centrostalkonstruktsiya by failing to pay them 150 hryvnias for the metal structures they supplied. In short, he disgraced his father in every possible way, stealing and throwing away “for small things.”
Maxim Mikitas. The Berezki scam
In February 2008, Maksym Mykytas shifted his focus from unsuccessful attempts at industrial construction to residential development in Kyiv. He became the CEO of Kyivsotsbud CJSC (Kyivsotsstroy CJSC, later re-registered as a private joint-stock company), a rather interesting enterprise established back in 2003. Both then and now, its owners are several Cypriot offshore companies, whose ultimate beneficiaries can only be guessed at. Specifically, in February 2008, two offshore companies sold their Kyivsotsbud shares to two other offshore companies – which were linked to the owners of Kyiv Vitamin Plant CJSC and Kyiv Printing Factory Zarya OJSC. Viktor Mykytas was also rumored to be in on the deal, thus placing his son at the helm of the company.
Information about the change of owners and management of Kyivsotsbud in February 2008
Before the Mykytases, the Kyivsotsbud company was engaged in construction of social facilities (hence the name); since 2008, it has focused on commercial housing. But, apparently, it's rare for Maksym Mykytas to complete a project without scams or scandals. Such was the construction of the Berezki residential complex in Vyshgorod, for which Maksym Mykytas, as director of Kyivsotsbud, hired his own company, Ukrstroymontazh. Ukrstroymontazh, in turn, hired someone else. Basically, Ukrainian construction is a far more shady scheme than gas-powered ones!
These subcontractors included Zhitloshlyakhbud LLC and Ukrenergobudmekhanizatsya OJSC, to whom Maksym Mykytas failed to pay for completed work and rented equipment. He also failed to fully pay for construction materials from the company Vertikal. They all filed lawsuits against Mykytas, which were already crowded with dozens of individual plaintiffs, calling Kyivsotsbud a second Elita Center. The fact is that, after collecting money from people for future apartments, Kyivsotsbud disposed of it in, shall we say, mysterious ways—because at the end of 2008, due to the financial crisis and financial difficulties, the company delayed the construction of the Berezki residential complex. A criminal case was even opened against Maksym Mykytas under Article 191 of the Criminal Code of Ukraine. Skelet.Org There are reports that people who actively spoke out against Mikitas's scams in 2008-2009 received threats from unknown individuals. In particular, several bloggers even received death threats!
Another interesting fact: Vyshgorod residents who observed the construction of the Berezki residential complex and showed excessive curiosity (touching, feeling, and looking) claimed that the quality of construction at the residential complex before 2008 (the first buildings were laid in 2005) was higher than when Maksym Mikitasy's subcontractors arrived later. And this wasn't the first time the quality of Mikitasy's firms' work had been called into question.
It's worth noting that Mykytas Sr. wasn't idle either (meaning without his own business), becoming the head of the supervisory board of Ukrenergomontazh PJSC in 2008. Yes, that's right, this was the second company to participate in Energoatom's tender! Back then, in 2008, Ukrenergomontazh and Ukrstroymontazh jointly won several tenders for work in the Chernobyl zone, but somehow messed things up—both financially and in terms of the quality of the work. The Ministry of Internal Affairs even opened a criminal case against them (yet another one). But Maksym Mykytas later claimed that this was merely the machinations of competitors.
The companies Ukrenergomontazh and Ukrstroymontazh are related not only because they were founded by father and son, but also because they were both among the associated private companies operating under the umbrella of the Ukrainian State Construction Corporation (state corporation Ukrbud). The history of this corporation is so convoluted that it requires a separate discussion. In short, the 1,500 construction companies merged into Ukrbud in 1991 shrank to 460 in 15 years, some becoming private firms, others going bankrupt or being acquired, and acquiring offshore companies and clones. Meanwhile, the private firms owned by Ukrbud's board used the remaining state-owned companies as cash cows. Ukrbud itself even had a clone—the PJSC Construction Company Ukrbud, created in 2004 by Prime Minister Yanukovych, through which the "Donetsk gang" intended to control the entire corporation. Another company, “Ukrbud Corporation”, affiliated with the main one, also emerged.
Under the roof of Ukrbud and Yanukovych
Sources of Skelet.Org It was reported that Viktor Mykytas, who had extensive connections at Ukrbud, decided to leave there with his company, Ukrenergomontazh, to secure major contracts for construction and repair work in Chernobyl—traditionally handled by his native UTEM, with whom he had fallen out. However, the father and son's own Chernobyl business didn't quite work out at the time, but in 2010, after the return of the "Donetsk guys," they received a major bonus from them: by order of the Prime Minister. AzarovMaksym Mykytas was appointed head of the Ukrbud corporation. For what accomplishments?
Sergey Varis, for Skelet.Org
CONTINUED: Maxim Mykytas: Family Secrets of the Billion-Dollar Tender. Part 2
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