Guryev vs. Gorbachev in UK Court Over $11B PhosAgro Stake

Key Takeaway

• Russian billionaire Andrey Guryev is embroiled in a UK court battle with Alexander Gorbachev over a significant stake in PhosAgro, valued over $11 billion.
• The dispute centers on alleged verbal agreements from 2005, with Gorbachev seeking nearly a quarter of Guryev's stake.
• Historical ties and accusations of dubious business practices add complexity to the case, highlighting the fallout from Russia's political landscape.

Legal Battle Unfolds

A high-stakes legal dispute has emerged in London, featuring sanctioned Russian billionaire Andrey Guryev and exiled tycoon Alexander Gorbachev. The contention revolves around a significant stake in PhosAgro PJSC, one of the world's leading fertilizer producers. Gorbachev alleges that shares rightfully belonging to him were improperly sold to an ally of President Vladimir Putin, seeking nearly a quarter of Guryev's stake in the company. PhosAgro, with an enterprise value exceeding $11 billion in 2023, represents a substantial portion of Guryev's wealth, derived from his just over 48% holding.

Disputed Agreements

Central to the case are decades-old verbal agreements purportedly made in casual settings, such as London pubs, between Guryev and Gorbachev. Gorbachev recalls a specific instance in 2005 where Guryev reassured him over a beer about the safety of his 25% stake in PhosAgro amidst Gorbachev's legal troubles. Guryev, however, denies any such agreements existed, labeling Gorbachev's claim as fraudulent and asserting that Gorbachev has no legal entitlement after cashing out his options in 2007 for $20 million.

Historical Ties and Allegations

The backstory of Guryev and Gorbachev's relationship traces back to their early days in the Soviet Union, where they embarked on building PhosAgro during the tumultuous privatization period following the Soviet collapse. Their partnership, described by Gorbachev's lawyers as trailblazing through the "unexplored wilderness of Russian capitalism," is now under scrutiny. Gorbachev accuses Guryev of engaging in dubious business practices, including the creation of sham documents and the use of opaque corporate structures for asset ownership in the UK. Guryev denies these allegations, attributing any backdating of documents to Gorbachev's efforts to evade taxes.

Fallout and Accusations

The legal battle also delves into the personal sacrifices and decisions made against the backdrop of Russia's political landscape. Gorbachev claims to have fled Russia in 2003 to protect Guryev amidst government pressure, losing his career, reputation, and country in the process. He alleges that Guryev, in collaboration with Putin ally Vladimir Litvinenko, sold Gorbachev's shares without his consent. Guryev's lawyers counter, portraying Gorbachev as solely motivated by personal comfort and resentful of the company's success post-IPO, which he observed from afar after cashing out.