Sunday, October 4, 2009

What the Russian Billionaire Prokhorov Really Wants by Buying the Nets NBA Basketball Team

Alexander Nazaryan explains:

Why does Mikhail Prokhorov want the New Jersey Nets?

He owns the world's largest nickel mine, runs a mammoth investment fund and, even after losing nearly half his fortune in the financial crisis, still claims $14.9 billion to his name. He even sports a pretty good basketball team in CSKA Moscow, which might beat the Knicks on a good day. Plunking down $200 million to dive into the mess that has been the Nets' move to a yet-to-be-built arena in Brooklyn seems foolhardy.

Then again, the acquisition of wealth is a sort of sport in Russia. Whereas the wealthiest Americans are expected to give away at least some of their fortunes, Russia's richest have mostly been concerned with amassing - and flaunting - them. The oligarchs who made billions in the post-communist 90s have taken vigorously to supermodels and ski resorts, tempered only by the occasional assassination attempt or unconvincing criminal investigation. Few have made headlines for, say, building schools in Africa. Not when so much caviar awaits.

But a curious new route to legitimacy has opened for the Russian oligarch: buying a foreign sports club. It worked for Roman Abramovich, who purchased the English Chelsea FC in 2003 and has since fashioned it into a rival to Manchester United, soccer's Yankees. The purchase instantly gave him credibility with a Western audience, and as the team's success grows, so does Ambramovich's stature.

It wasn't always like this: Some years ago, Russian oligarchs entertained a faintly altruistic impulse. Mikhail Khodorkovsky, once the wealthiest man in Russia, funded a variety of social causes through his Open Russia Foundation. But he also voiced left-leaning political notions that didn't sit well with Vladimir Putin's "dictatorship of law." Arrested in 2003, Khodorkovsky now languishes in a Siberian prison camp.

In his bid for the Nets, Prokhorov is clearly following the safer Abramovich model. Both are young and photogenic, with a penchant for landing on the tabloid pages

Read the full column here.

1 comment:

  1. Actually, Mikhail Khodorkovsky is no longer in Siberia, but is rather being put through a second show trial on trumped up causes. Click my name to read more about it on our blog, as well as other Russia issues.