Arcadi Gaydamak welcomes me in his spacious Caesarea home. The house spreads over 1000 square meters, lion statues and paintings of dragons are erected near Gaydamak's armchair, gold shines everywhere, and giant chandeliers gleam opposite big windows overlooking dunes and the sea.
"I speak Hebrew excellently," says Gaydamak at the end of the interview that was conducted in English. But it is part of him to act like and be presented as an outsider, like "a stupid immigrant from Russia," he says sarcastically.
It is important for him to be an outsider and win. "Gaydamak in Turkish means a fighter. That's me," says the man who has been tirelessly trying to prove that he is not just another shooting star in the skies of Israel.
Gaydamak (Photo: Ofer Amram)
In the garden, dozens of stagehands can be seen vigorously fixing the stage and audio systems for his 55th birthday party. His friend and former partner, billionaire Lev Leviev calls and promises to show up. Former Prime Minister Benjamin Netanyahu, a neighbor who has been spending quite a lot of time at Gaydamak's, has promised to attend.
Gaydamak is frequently under the spotlight of Israeli media but he rarely grants interviews. But granting this interview is good timing: Last week, on the eve of Passover, the Russian-Israeli tycoon shook hands with the Aviv family after sealing a deal to buy its controlling share in Ocif, an investment and development firm, for NIS 600 million ($146.3 million).
And he did not mind paying 85 percent more for the company than its market value. Gaydamak discloses that the plans to turn Ocif into one of the largest companies trading on the Tel Aviv Stock Exchange. Gaydamak claims that the company will initially handle $5 billion through operations abroad.
The tycoon makes no secret of his plans to turn Ocif (TASE: OCIF) into a second Africa Israel, the investment company controlled by his longtime partner-rival Leviev.
In 2001, Gaydamak sold his 15 percent stake in Africa Israel to Leviev for $75 million. Today, a 15 percent stake of Africa Israel is valued at $840 million – a large sum even for a man said to be worth close to one billion dollars. He admits that the sale was "a big mistake."
What is your dream?
"Dream is a big word. Israel fits in well in the new markets I do business in, Africa, countries of the former Soviet Union, places that will witness speedy growth in the near future. After many years in these markets and once diversified business fields have developed – real estate, agriculture, energy, industry and mining – I want to set up the classical platform for a public company with a built-in structure. Ocif will serve as a holding company for all the above, will be based in the Tel Aviv Stock Exchange and operate with full transparency."
When I slip up and I ask him about the "Aviv-Ocif group," he fires back: "The company I am buying is called Ocif. Not Aviv. We are buying the shares of the Aviv company. At the moment the Aviv company is working exclusively as an executive body and is marketing Ocif. When I become controlling shareholder I will decide with whom to work.
Following Gaydamak's request, Ocif chairman Doron Aviv and general manager Dafna Harlev will keep their posts for two years, until the conclusion of current projects.
Gaydamak says Ocif will spearhead construction and development projects in Africa and Russia.
AFG, a Moscow-based real estate fund set up in 2006, will be managed by Ocif. AFG employs 40 people and holds land and office space in eight central locations in Moscow.
Since its establishment, $825 million have been invested in the company whose assets amount to $3.3 billion.
Gaydamak plans to build a town with 30,000 housing units outside Moscow as well as 1 million square meters of housing space in Russia. He also intends to invest in a small oil company that operates in the Caspian Sea.
In Israel, Gaydamak plans to add more companies to his shopping list, preferably in the factory farming business. In Russia he is a leader in the production of eggs with factories that produce 4 million eggs daily and with a turnover of $100 million. "I am looking for an Israeli company in the field, that is strong in technology and that will be integrated in the Russian market," he said.
Ocif is facing the threat of stock dilution, from 60 percent that you are buying today to half of that, because of the conversion of bonds and options.
There is no threat at all. First, people are bying Ocif shares now because they trust Gaydamak. Nobody wants Gaydamak not to be in control of the company. This is a psychological point. Secondly: I have enough money to buy enough shares so they cannot take the company from me, to prevent dilution.
Will Ocif become Africa Israel?
I am not familiar with Africa Israel's structure. It has excellent real estate companies, and Gottex (Fashion retailer bought by Leviev in 1997). Today, it is a very successful company and if I have the same success that will be excellent.
How did your relationship with Lev Leviev start?
I came to Israel in 1998. I met him in the same period in the frame of our community work in Russia. We had common projects there for the sake of Judaism. In 1992, I was an official of the Angolan regime. I was appointed by that country to oversee the organization of the raw diamond market and responsible for the governmental authority that later controlled this market. In 1999, I invited Leviev to work in the field of diamonds in Angola, and through this he became one of the major players there. Yes, through my help.
(Leviev has said that he entered the Angolan diamond market five years earlier. But Gaydamak sticks with his version.)
So is that how you came to know Africa Israel?
Yes. I bought 15 percent of its shares but we didn't get along. We both have leadership visions and there is a Russian proverb that goes: There is no place for two bears in one cave. I sold back my shares for $75 million.
Big mistake?
Yes, today it is clear that I made a mistake. It was a big opportunity that I missed.
You have no luck. You haven't succeeded in purchasing company after company: Israel Corp., Maariv, Sonol, Minrav.
I did try to purchase Israel Corp. and it wasn't my fault it didn't happen. For Maariv I made an offer and that's it. As for Minrav, I had intentions, but in retrospect I'd be more beneficial as a holding company. Minrav is an established company and I very much respect its owner, Abraham Kuznitsky, but the state raised obstacles. Because of Minrav's role in establishing a private prison, (the state) barred it from selling shares without state authorization. The permits would have taken months, and that didn't suit me.
How far do you want to go?
I bought Beitar and I promised we'd reach the championships within a year, and we're first place. When I bought Beitar I didn't tell Ohana to go. He went on his own. He wasn't a true coach, either. Coach Ossie Ardiles was a mistake. I switched to Yossi Mizrahi and now we're number one. Like in Beitar, I'll change every site and every field in Israel to number one.
The majority of your international activity is in chemicals in Kazakhstan and the Ukraine. Will that go under Ocif too?
Not at this stage. Not as long as the National Unit for International Investigations is working against the interests of the state of Israel to chase off world Jewry. To be advanced in the ranks, they want to make an example of me. Later, when Gaydamak's victory is complete, there is no doubt I will enter the field of chemicals as well.
Police probe
Police are investigating Gaydamak on money laundering suspicions. Gaydamak allegedly transferred tens of millions of dollars to Israel through straw companies. Police claim that after the money was "laundered" he transferred it abroad. Police suspect he worked in cooperation with Israeli businessman Nahum Galmor, who owns the chemical corporations Thermphos and Kazphosphate that are based in Kazakhstan and operate worldwide, from China to Argentina. According to police suspicions, Gaydamak transferred business to Galmor in return for future profits.
"The company belongs to Galmor," Gaydamak claims. "I put all the money in this company. Maybe it doesn't appear to make sense, but it certainly makes sense to take a losing company and transfer the management and ownership to someone with skills and experience in return for the company's recuperation and for future profit sharing. Nothing was done under the table. Who is going to teach me business? The National Unit for International Investigations (NUII)? Is it illegal to partner up with a defeated company? Where is the crime here?
According to suspicions, money laundering and smuggling money from the Hayarkon branch of Bank Hapoalim to an unknown destination abroad.
I didn't launder any money and I didn't cross any law. (Cmdr. Yohanan) Danino (head of the police investigations and intelligence) has been chasing me for years to build himself a career. He started pursuing me upon the request of the French government and in coordination with them, when he started looking into my financial sources with wiretaps. I have always had money in Israel.
The NUII were the ones doing illegal activities and that's why I took my money and transferred it to a Russian bank. NUII tried to get information on that account without permits. An officer went to the bank branch, presented his documentation and requested details on the account. The bank demanded a court order – and he ran away. The bank consulted with Bank Hapoalim's legal advisor and decided to inform me officially about the strange behavior. I went with Attorney Yaakov Weinrot to Cmdr. Danino, I saw that his reaction was unsuitable, and I quietly gave orders to transfer the money abroad. The Israeli police are acting against me like the mafia. Due to the investigation, billions of dollars belonging to Jewish oligarchs are moving to banks in Luxembourg and Switzerland instead of Israel. This country is crazy.
Now that you're in a public company, any report of probes against you could make stocks drop.
On the other hand, if the announcement is the opposite – the stocks could soar. I demand answers from NUII and they aren't giving them. If they don't answer my questions, in a month I'll start acting against them publicly and show the public who's trying to incriminate Gaydamak by any means.
Will they succeed?
Not a chance. The forces of light always win. Look in the Talmud.
France decided to file an indictment against you for illegal weapons sales in Angola.
Gaydamak exhibits the decoration for bravery he was given by the French in 1995 for saving nine French hostages in Yugoslavia. "The investigating judge is supposed to be appointed to a senior position and he had to close this file. Eight years no one asked me a thing and didn't let me respond. I acted legally according to Angolan law. This story will end in nothing.
They say Gaydamak buys everything.
That is a mistaken impression. It's nonsense. People don't know what to say. I buy respect. I buy laughs?
Why did you decide to buy an abandoned Israeli radio station?
In Russia I have one of the leading stations, Business FM. It employs 300 journalists who broadcast current affairs around the clock with breaking news. When I announced my intentions to buy the station Attorney General Menahem Mazuz asked the Second Authority for the documents to review six months ago. The fact that he asked for them means there's a problem already. As an Israeli citizen I'm allowed to buy whatever I want and no one can stop me.
What are your plans for the new radio station?
Israel is a primitive country when it comes to media. It's stuck in the 20th century. I have one of the leading European radio stations in Russia. Here you have two girls in a record library with bad music. There is no creativity. There isn't really radio in Israel. Due to the situation there's an army radio station with analyses of the Middle East situation all the time. That is necessary, but it's not enough.
You often enter social investments in places where the state fails.
I don't invest. I act to fulfill people's needs as much as I can, and I'll continue to do so.
You bought dozens of apartment units from Heftsiba in Har Homa to sell to the poorer classes at subsidized prices, and the plan was grounded.
There were problems with the neighbors in Har Homa who complained about the plan. That's life. It wasn't exactly cancelled, but we'll look (into subsidizing housing) for the needy elsewhere. Now that I have Ocif land, maybe from there. In Har Homa we'll sell the apartments we bought but at a cheaper price.
You were once a close associate of Olmert's?
He just exploited me for his own good as a contributor to various activities.
Israel hasn't made your life easy. Why continue? Your daughter Katya said recently that "in the end you'll put an X on Israel."
That's not true. I was mad at her and she said they twisted her words. There are acts motivated by jealousy, anti-Semitism and anti-Israelism, like for some people in the police and newspapers. I don't care what they think. They don't represent the country for me.
Israel has a good economic system and I think the representatives of Israeli economics think highly of me, and that can be seen in the rise of stock values with the Ocif deal. Even the stocks of companies that I negotiated over have leapt. That means that the market has a positive opinion about Gaydamak.
Have you set limits? Is there a point at which you'll say: Okay, I give up?
No. this is my country. I'm no more or less Jewish than any other Jew. Israel has survived because we haven't forgot our Judaism, but there are some Israelis who did forget.
Will you enter Israeli politics?
We have 120 people in the Knesset working only for their own interests. I already do the same work as the politicians, but much better. They ask, how can a stupid new immigrant do all this alone? In a few months I became popular in Israel. I can raise my voice and people will follow me.
I wanted to make Nitzanim five times bigger. 27,000 people moved there from the start of the war (in Lebanon last summer), but we needed permits from the government for the land, and they wouldn't give them. They were only interested in showing how much better they are than Gaydamak. As if I was competing with them. They set up a camp in the Exhibition Gardens on the last day of the war.
So you will enter politics?
I'm already in politics. To be the member of a party is useless. If I see that to fight politicians and the police I have to use their own means – then I will use them. If I need to establish a party, I will. They are stupid to think they can mess with me.
It is said that you enjoy your popularity?
It's not that I enjoy it, it's that I'm famous and that's a fact. I don't love the sun or the moon every day. It's just natural.