UK Freezes Assets Of Roman Abramovich-Linked Steel Firm

Law360, London (May 6, 2022, 1:58 PM BST) -- The government has frozen the assets of Evraz, a major Russian steel and mining company linked to oligarch Roman Abramovich, adding to its catalog of sanctions since the invasion of Ukraine.

The Foreign Office said on Thursday that it has sanctioned Evraz PLC, which produces 97% of all rail-tracks within Russia. The sanction is intended to target key parts of the country's military economy, as Russia uses rail transport to move equipment and personnel for military operations.

The asset freeze prevents any U.K. citizen or company from legally interacting with Evraz or its assets, which also produces 28% of Russia's railway wheels.

Abramovich, the owner of Chelsea Football Club, was its largest private shareholder, with 28.6% of Evraz shares as of March 10, according to the company's website.

HM Treasury's sanction's list alleges that Evraz could have supplied steel used in the production of Russian tanks, and that it has contributed to the invasion of Ukraine.

Evraz did not immediately respond to a request for comment.

The Financial Conduct Authority suspended trading of Evraz securities on the London Stock Exchange on March 10. The City watchdog said that the suspension was intended to protect investors until the effects of U.K. sanctions were clear.

The oligarch has faced increasingly severe restrictions since the Russian troops marched across Ukraine's borders on Feb. 24. Judges in the British Channel Island crown dependency of Jersey froze $7 billion worth of assets on April 13 because they suspected they were linked to Abramovich.

Abramovich has gained celebrity status in London due to his net worth of $12.4 billion, his jetset lifestyle and ownership of the Premier League soccer club and European champions Chelsea.

The oligarch was first hit with sanctions on March 10, when the government froze his assets, blocking the Russian, Israeli and Portuguese national from selling the club, which Forbes valued at $3.2 billion last year. 

Chelsea FC director Eugene Tenenbaum was a director of Evraz from Oct. 14, 2011 until March 10 this year according to Companies House, the U.K.'s publicly available registry of companies. Westminster sanctioned the Canadian national on April 14, saying only that he was associated with Abramovich. 

British billionaire Jim Ratcliffe made a £4.25 billion ($5.3 billion) bid for Chelsea FC on April 29, with £2.5 billion of that sum to be put into charitable trust to support victims of the Russian war against Ukraine.

However, U.K. press reports on Friday suggest that a consortium led by Todd Boehly, the co-founder and chief executive of private investment shop Eldridge Industrials LLC, is in the box seat to buy the club.

MPs unanimously voted for a new economic crime law following Russia's invasion to stem the tide of dirty money coming into the U.K., fast-tracking it in a single day after a seven-hour debate.

--Editing by Joe Millis.

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