Former Icelandic business tycoon’s Russian business practices in spotlight

A former business partner of Icelandic ‘outvasion Viking’ Björgólfur Guðmundsson has this week used his new book to accuse him of making threats and trying to bribe him when their relationship went awry in Russia in the 90s.

Former billionaire Björgólfur used have large or controlling stakes in Landsbanki, West Ham United, Eimskip and XL Airways, among many others; but has since been declared bankrupt following the financial crash. He made his money initially in the Russian drinks business after the fall of Communism.

Now a former colleague says he was threatened and offered bribes by Björgólfur when a contested contract between the pair in St. Petersburg ended up in court. He accuses Björgólfur of having dishonestly appropriated property and an entire factory in Russia, RÚV reports.

The partnership between Ingimar Ingimarsson and Björgólfur Guðmundsson on the Russian soft drinks market began in the early 90s. Ingimar had started a company in Russia with Bernard Lardner, called Baltic Bottling. Baltic signed a deal to purchase equipment from Gosan, which Björgólfur indirectly controlled through his Pharmco company. Björgólfur Guðmundsson sat on the board at Baltic on behalf of Pharmco; although neither he nor other staff had shares in the factory. Business was tough at first, but things soon became much easier.

In September 1995 one of the executives at Baltic was unexpectedly barred entry to the factory by armed guards and told that a change of ownership had taken place. Björgólfur had said that Ingimar Ingimarsson had sold him his share in Baltic earlier that year with a signed contract which later became highly controversial in court. The sale price was said to be half-a-million dollars — which is itself noteworthy as the firm’s annual turnover was already as high as around USD 30 million.

The Baltic Bottling shareholders’ meeting in which the sale was approved, is said to have taken place on 29th September; but no representative of the seller was present. Russia’s register of companies approved the deed nevertheless and the factory came into Björgólfur Guðmundsson’s ownership.

The precise date of the shareholders’ meeting became a hot topic later in court. Ingimar and Bernard’s lawyers claimed that Björgólfur had himself not been in St. Petersburg on the day the meeting was alleged to have taken place, as he had been seen at a football match in London.

In his book on the affair, which was released yesterday, Ingimar tells of threats and bribery attempts on Björgólfur’s behalf, whereby he is alleged to have offered some two million dollars for Ingimar to stop the court case. He apparently refused the offers.

Ingimar and Bernard went on to win their case on three judicial levels; but Ingimar Ingimarsson did not manage to get his assets back when he tried to in 1997.

Ingimar says that at that time it came to light that all the assets he had been fighting for in Russian courts for a year-and-a-half had been transferred over to another company — a company called Bravo. The disputed assets in Baltic Bottling were, therefore, beyond his reach.

Ingimar Ingimarsson was interviewed about his damning new book last night on RÚV’s Kastljós current affairs news programme.

Bravo was set up in 1996 as a brewery, which was later sold to Heineken for USD 400 million. The remains of Baltic Bottling itself were sold to Pepsi at around the same time, according to Wikipedia.

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