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Thursday, June 10, 1999 Published at 16:50 GMT 17:50 UK

Russian tycoon expands empire

Berezovsky (right) helped finance Yeltsin's re-election campaign

By BBC Foreign Media Correspondent Vickie Maximova

Russian business tycoon Boris Berezovsky is rebuilding his reputation and fortune after a series of setbacks under the government of Prime Minister Yevgeniy Primakov.

With Russia's parliamentary elections only a few months away, Mr Berezovsky, a major stake holder in the Russian Public TV channel (ORT), seems to be on the ascent again.

But the Russian press reports that Berezovsky is rumoured to be in debt.

With his arch-enemy, Prime Minister Yevgeny Primakov, out of the way, Mr Berezovsky has been busy negotiating several deals at once. It is an effort to expand his media empire ahead of this year's parliamentary and next year's presidential elections.

According to one of Russia's most respected dailies, Kommersant, Mr Berezovsky controls TV stations reaching 60% of Russia's TV audience.

His media holding now includes at least three major nationwide networks: TV6, Russian Public TV (ORT) and STS.

Growing empire

He also owns a number of newspapers and is now said to be negotiating a deal to buy Kommersant.

In a recent television interview, Mr Berezovsky confirmed he was to increase his stake in Russia's main entertainment network TV6 to 75%, thus gaining the full control of the company.

[ image: Berezovsky: An expanding empire]
Berezovsky: An expanding empire
Controversial presenter Sergey Dorenko, dubbed by Russian broadcasters as Mr Berezovsky's rottweiler, has been appointed as head of news at the channel. The move signals that TV6, previously thought to steer clear of politics, is to become a news heavyweight.

Mr Berezovsky has also taken care to strengthen his position at ORT. His company Logovaz already holds 11% of ORT shares.

A bank consortium, which includes the United Bank, also part of Mr Berezovsky's empire, owns a further 38% while the remaining 51% are owned by the state.

Financial questions

The ORT board of directors has now decided to increase the rights of the private shareholders. Specifically, they have been given the right to approve appointments or sackings of ORT's chiefs.

Previously, this right belonged solely to the state as the channel's main shareholder.

Mr Berezovsky's fellow-thinker, Eduard Sagalayev, who was until now the boss of TV6, has moved to ORT in the powerful capacity of deputy chairman of the ORT board in charge of strategy and development.

One Russian TV channel (ORT) compared Mr Berezovsky's return to the political scene with the return of Napoleon from the island of Elba.

Is he to stay on the scene for longer than 100 days? Or is his enormous media holding just a phantom empire of Robert Maxwell's proportions?

The Russian periodical Argumenty i Fakty has recently reported that Mr Berezovsky is deeply in debt.

His legal battles under Mr Primakov had seriously undermined his financial resources, the paper said.

Mr Berezovsky had to use a $150-m loan from a Russian-born Israeli citizen, who has control of Russia's aluminium industry, for all of his recent acquisitions.

Siding with Yeltsin

Mr Berezovsky's political affiliations still firmly lie with President Yeltsin.

At a recent news conference, reported by TV6, Berezovsky admitted he was on good terms with the president's daughter, Tatyana Dyachenko, and the president's chief of staff Aleksandr Voloshin.

He did admit however that at present his personal relationship with Mr Yeltsin himself is at a low point.

Mr Berezovsky said he did not have meetings with Mr Yeltsin nor did he care much that Yeltsin did not like him.

Mr Berezovsky, however, is clearly repositioning himself as a crucial force in the forthcoming elections, and whoever he supports is likely to have media access to a very large share of the Russian electorate.

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