Mikhail Borisovich Khodorkovsky (Михаи́л Ходорко́вский) once ranked 16th on the Forbes list of Billionaires. He was Russia’s richest man for a number of years, and while his reported current fortune of $500 million may place him lower on the list of Russian oligarchs, Mikhail Khodorkovsky is still one of the country’s most influential and inspiring businessmen.
Early Life and Career
Born in Moscow, in 1963, Khodorkovsky grew up in a typical, middle-class, Soviet family. Both of his parents were engineers and worked at a local factory. His father was Jewish, his mother Russian Orthodox, and yet this union still formed a ‘model’ Communist family. Khodorkovsky excelled in school and graduated in 1986, with a degree in Chemical Engineering from the elite Mendeleev Moscow Institute of Chemistry and Technology. He was at the forefront of ‘perestroika’ under Mikhail Gorbachev and utilized his connections as a member of the Communist Youth League (Komsomol) to open a successful small business in 1986, and in 1987, the Center for Scientific and Technical Creativity of the Youth, a company that bought and sold computers.
Founder of Menatep
Mikhail Khodorkovsky’s start on the road to the title of the richest Russian began in 1987 when he founded Menatep, a bank that was to become the first private bank in a post-Soviet economy. Much of the foundation of his wealth was laid in the early years of the 1990s, when the bank was able to purchase large amounts of shares in companies that were being privatized across Russia. The fertilizer firm Apatit was purchased in 1994 and the oil company giant Yukos was bought in 1995 for around $350 million.
Turning Yukos into a Global Giant
Taking on the failing oil company may have seemed to some as a massive risk, but within just a few years, Yukos was Russia’s second largest oil company with international investors lining up to purchase shares. The company was one of the first in Russia to use the international standard for accounting, transparency, and accountability, making it a success both at home and on the international financial markets. Part of Khodorkovsky’s success in banking and investment was bringing Yuri Milner back from the US and appointing the young banking strategist as CEO of Alliance-Menatep, the former’s investment firm.
In 2003, both Mikhail Khodorkovsky and Roman Abramovich were named as Person of the Year and in April, the pair announced the merger of Yukos and Sibneft, a Gazprom subsidiary, owned by Roman Abramovich and Boris Berezovsky. Khodorkovsky’s arrest in 2004, caused the merger to fail, though at the time it was considered to one of the world’s most daring mergers, and was to transform Yukos into the second largest oil producer on the planet.
Khodorkovsky was imprisoned for nearly a decade on charges of fraud and tax evasion among others; he put his intellect and affinity with the Western Press to good use, helping fellow prisoners and continually working for better conditions in prisons. In 2011, an assistant to the judge in his trial came forward with information claiming that the judge did not write the verdict, that the case was rigged and the trial was fixed.
Despite lodging several appeals through the European Court of Human Rights and much support from the West, Khodorkovsky remained in prison until President Vladimir Putin pardoned him in 2013. Khodorkovsky immediately left Russia to reunite with his family.
Khodorkovsky now lives in Zurich, Switzerland with his wife Inna and his three children. He has a son, Pavel Khodorkovsky, now married and living in New York, from his previous marriage to Elena Dobrovolskaya. He remains on excellent terms with his ex-wife Elena, who was an activist for his release from prison.