Nikolai Lavrenko: Nouveau Riche or From Rags to Riches
Ukrainian print and online publications devote considerable time to covering insider information about the lives and activities of domestic oligarchs and major businessmen, especially in light of the current trend toward "fighting the oligarchy" declared by President Volodymyr Zelenskyy. However, almost no journalists have delved deeply into the lives and biographies of top managers of large Ukrainian businesses. We consider this approach to be highly unfair, as many of their figures deserve special attention. With this article, we begin a series of publications that will introduce our readers to another aspect of large Ukrainian business groups: their top managers.
This article will reveal a small part of the life and work of a character little known to the general reader, but well known to a certain circle of energy businessmen: Nikolai Lavrenko, president of the large energy and hotel holding company VS Energy International Ukraine.
The holding company "VS Energy International Ukraine," recently renamed "VS Group Management," owns a number of regional energy distribution companies (known as oblenergos), electricity suppliers, and the Premier Hotel chain (hotels in Kyiv, Lviv, Odesa, Dnipro, and occupied Crimea). The company is quite large, influential, and reputable. This business group is more widely known in Ukraine as "Luzhniki Group." This nickname was given to it because the group's owners included a number of businessmen and politicians from a neighboring country, which has been an aggressor state for over eight years, who made their first big money in the 90s at the Luzhniki market in Moscow. Many in Ukraine are, of course, familiar with names like Babakov (former State Duma deputy), Giner (former owner of the Moscow football club CSKA), and Voevodin (a highly influential crime baron throughout the former USSR). It is with these individuals that this business group has always been associated.
The holding's owners haven't had the best of times in recent years. Following Russia's aggression against our country, the company encountered problems in Ukraine, and servicing the business group's extensive loan portfolios became much more difficult. The influence of the powerful "Moscow uncles" diminished significantly; moreover, their names became toxic in Ukraine for obvious geopolitical reasons. There were even rumors that the group might sell its Ukrainian assets and exit the business altogether. However, these rumors were exaggerated.
Until 2015, Mikhail Spector managed the group's Ukrainian business. This imposing man is a well-known Ukrainian businessman, known in certain circles as a casino gambler and a lover of the lavish lifestyle (private jets, yachts, an entourage of model-looking women, security convoys, and other trappings of the high life). However, in 2015, this interesting individual left the company for reasons that remain unclear. Rumors circulated that he had a personal conflict with one of the holding's owners, Evgeny Giner, which was the main reason for Spector's departure from the prestigious position of president of VS Energy.
However, the main surprise for many uninitiated into the inner workings of this business group was the appointment of a rather provincial character, Mykola Lavrenko, as the company's president. Those close to him simply call him "Kolya." To briefly but succinctly portray this man, it's worth remembering that before working for Russian businessmen, Mykola Mykolaevich Lavrenko spent some time in government service. He served as deputy head of the Kirovohrad Regional State Administration and head of the Vinnytsia Tax Inspectorate. However, this was quite a long time ago, from 1999 to 2003. He was "ousted" from both positions not without involvement in corruption scandals, as is typical of many officials of former Komsomol stock. Lavrenko, throughout his career, even during the Soviet era, tried to advance himself by embracing the ideals of communism. But we shouldn't judge him harshly for this, as in those days, it could indeed significantly contribute to career advancement.
Nikolai is described as an uncouth, backwoods man who literally speaks in obscenities, and is indifferent to gender. His subordinates call him a "collective farmer" because he gives the impression of being completely uneducated, almost illiterate, and even poorly read; his secretary reads all texts aloud to him. Kolya texts very rarely and very little, exclusively short text messages without punctuation. Education, in short, isn't his strong point. His usual interactions with company employees involve incessant shouting and screaming, endless mountains of obscenities, and, as a result, no one is able to discern the true meaning of Kolya's random collection of words. However, this level of intelligence doesn't prevent him, a serious man and high-level manager, from having several mistresses at once, right in the company office. Rumor has it that Lavrenko enjoys the attention not only of his personal secretary, but also of his accountant and even his personal hairdresser. Kolya doesn't forget his ex-lovers either, even those who are too old to attract his attention. Although our hero himself is no longer a boy, he's 65, but he loves women, certainly younger. Nikolai brought several of his former muses to Kyiv from Kirovohrad and Vinnytsia, found them jobs at the company, and gave them, so to speak, a start in life. He's a man of the most generous soul, there's no other way to describe him.
Lavrenko's appointment to this high-ranking position came as a surprise to those unaware of the true dynamics within the group. In fact, the reason for this reshuffle was that Giner, who, as we noted above, disliked Spektor, actually warmed to Lavrenko. The reasons for this are quite simple: Lavrenko, like Giner, is a longtime football fan. Giner had his favorite club in Russia, CSKA, while Lavrenko had his own football club, the Poligraftekhnika Football Club, based in his hometown of Koli, a provincial town in Oleksandria, Kirovohrad Oblast. The Ukrainian football club is certainly difficult to compare in terms of level to the Moscow club, but the two men's passions coincided precisely in football.
However, Giner's "love" for Lavrenko was short-lived. Once Yevgeny Giner realized Kolya's true nature—namely, his innate kleptomania and chronic passion for lying—even their shared passion for football didn't help; a wall of misunderstanding immediately grew between them. However, several factors helped Nikolai Lavrenko secure his position: the business group's owners found themselves effectively isolated from their Ukrainian assets after the outbreak of the Russian-Ukrainian war. Giner's son, Vadim, who oversaw the group's Ukrainian business, left Ukraine, fearing persecution for his "Russian affiliation," thereby only strengthening Kolya's position, effectively cementing his position as president of the holding company. Furthermore, there is a legend that Kolya possesses significant incriminating information against the group's shareholders, which has also made him largely "untouchable." The last factor sounds a bit unfounded, but after learning the essence of things, which we will try to tell you below, it is difficult to find other adequate explanations for Lavrenko's more than six years in office.
So, Lavrenko, having taken the helm of this serious business group, began raking in significant amounts of money very quickly. The man, who, after joining the holding company as its industrial director with a salary of $5, has become a virtual multimillionaire in dollars over the past six years.
Today, Lavrenko owns three hot-dip galvanizing plants in Ukraine, effectively becoming the domestic leader in this field. These plants are located in the Kyiv region, the Odesa region, and near Kharkiv. According to preliminary estimates, the construction cost of each of these plants is approximately $20 million. Therefore, the total value of this portion of Lavrenko's business alone is approximately $60 million. Furthermore, in recent years, Kolya has acquired a dairy production plant in the Kyiv region, actively promoting his "Lago" brand in retail chains, and is also attempting to establish a full-cycle milk production facility on his own farm. According to our information, Kolya's dairy business is valued at approximately $5-7 million.
In the Osokorki district of Moscow, where our hero settled, he became the owner of many hectares of land, on which he built several cottage communities, the Pioppo Nero restaurant and pizzeria, the Nicolas country restaurant and hotel complex, a yacht club, the Dochki i Synochki kindergarten, as well as three (!!!) football stadiums, an ice rink, tennis courts, and other sports infrastructure. You might be wondering, why does Kolya need three stadiums? It's simply that Kolya, reminiscing about the past, decided to return to those glorious times and founded a new, capital-based football club, Levy Bereg, which is currently only in its infancy, in the second professional football league.
However, Lavrenko understands well how to quickly and effectively "move" to the Major League. After all, it's simply a matter of financial investment. Incidentally, he created the football club jointly with a certain Yura Dovgalenko, better known by the nickname "Dovgal," who has a rather peculiar reputation in his past life, having held the position of "foreman" in the organized crime group of the now-deceased crime boss Rybka. Kolya and Yura met over land interests in the capital's Osokorky district. Incidentally, Dovgal has his own "business" with a name similar to the football business—Left Bank. This public organization is actually a combat unit recruiting groups of thugs to carry out orders for land seizures, extortion, and other similar activities.
Nikolai is currently actively constructing a fourth stadium in Osokorky, which will meet the requirements of the Premier League. Rumor has it that the land for this new stadium was actively secured with the help of the same public organization of the same name. Nikolai also owns a medical clinic in Osokorky, as well as two solar power plants in the Kherson and Odesa regions, each with a capacity of 10 megawatts. The construction cost of each plant is $10 million. It would be strange not to own an energy business while in such a position. A couple of years ago, Nikolai also reached a new level, becoming the owner of a wind farm in Cyprus worth approximately 3 million euros, and also purchased four villas on this sunny island for a total of approximately 4 million euros. And this is far from a complete list of his achievements as a top manager at VS Energy International Ukraine.
You might think that Lavrenko, as president of such a major holding company, receives such a high salary that it allows him to accumulate such substantial personal assets and build his own, far from small, business. Certainly, such a manager's salary cannot be small; by our country's standards, it's even exorbitant—$35 per month. You'll agree that our hero began earning significant money in 2016. However, even with such a stratospheric salary, by our standards, building a business and acquiring assets worth over $100 million in six years remains an unattainable goal. So what's the secret, you ask? The secret to Kolya's success is that, possessing the very same compromising material on his Russian employers, he has become truly "untouchable" and has learned to use his Moscow bosses' businesses for his own personal gain.
What exactly is the energy business owned by VS Group Management? You might ask, is it really possible for Kolya to steal so much from shareholders' pockets that he can accumulate so many personal assets so quickly in just a few years? Here's how we explain that the main sources of income for these Russian businesses are kickbacks from tenders for equipment purchases and construction and repair work on power grids, which are carried out as part of energy companies' investment programs.
Yes, yes, the very same money we, the residents of Ukraine, pay in the tariffs we receive in bills. We pay, we suffer, we argue, we stage protests, the government makes populist promises not to raise tariffs for the population, the regional power companies argue with the government, supposedly wanting to improve and upgrade the power grid, and meanwhile, Kolya simply receives mega-kickbacks from all this, buying equipment at inflated prices and commissioning exorbitantly expensive work, building his personal "kingdom" worth hundreds of millions of dollars.
Another significant cash flow is bribery for issuing technical specifications to regional power companies for connection to the power grid. The sums involved in this business are unknown only to those who have never encountered such issues. We're talking about millions of US dollars monthly, which fly into Kolya's pocket. Moreover, part of the money generated by VS Group's business obviously reaches both shareholders and Ukrainian officials, since everyone is satisfied. It is said that VS Energy's business is structured in such a way that kickbacks and bribes are deposited directly into Kolya's office on Hospitalna Street in Kyiv.
He has a couple of specially trained people who manage the cash register. In short, Kolya's tax experience was well worth it; he's certainly learned how to collect taxes. It's difficult to estimate who earns more: Kolya or his employers. Apparently, they're content with Kolya pulling such tricks under their noses. Although, of course, it's hard to imagine how they could allow millions of dollars to be stolen. Perhaps the shareholders' apparent indifference is also due to the fact that they've been trying to split up the business for several years now. Players in the Ukrainian energy market have long been discussing this.
During this period, the holding company's size has shrunk slightly—Odesaoblenergo and Kyivoblenergo were sold, with Kirovogradoblenergo next in line. All these assets were acquired by the DTEK Group. However, a very interesting situation could arise where, during a period of dispute between shareholders, Kolya himself, at their expense, becomes worth more than their entire business. However, there is a silver lining to this—our Ukrainian "Orthodox" hero is cowering at the expense of our enemies, the Russians. This fact certainly adds a patriotic and positive touch to this whole story. As the saying goes, "the toad fucked the viper."
It's worth explaining the reason for the epithet "Orthodox" applied to our hero. Having moved to Kyiv, Kolya suddenly became a very active parishioner of the Russian Orthodox Church, and was so deeply imbued with love for the Lord that he even built a church in his beloved Osokorki neighborhood in his honor, right between his pizzeria and the football stadium. The icons, the foundation, and individual elements were brought from Mount Athos, a fact of which Kolya is immensely proud. According to the builders who erected the church, the construction cost between 3 and 4 million dollars. Next to the church, Kolya built monastic cells and also created his family's… burial vault in the church basement!
The servant of God is likely preparing for canonization after his passing, and perhaps even during his lifetime. After all, so many "bright deeds" are accomplished by his hands while he heads such a wealthy Russian business holding. Remember Leonid Yakovishin, the Chernihiv farmer who built his personal mausoleum in the Napoleonic style a year ago? He's not the only one. Kyiv has its own "saint," Kolya, who atones for his sins in his own church and prepares to find rest in a holy place.
We hope this series of publications will be of interest to our readers. We will strive to obtain as much inside information as possible. Coming soon, we'll be sharing fascinating stories about the top managers of other Ukrainian business groups. Stay tuned—the most interesting stuff is yet to come.
Sergey Irtenyev, for ORD
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