Bank targets Chelsea boss in £9m battle

THE company that provided the funds for Roman Abramovich's spending spree at Chelsea football club faces renewed legal action by the European Bank for Reconstruction and Development.

Sibneft, the Russian oil company that is the source of the oligarch's estimated £7.2bn fortune, is being pursued by the EBRD over an unpaid loan of £9m for which Abramovich is being held partly responsible.

The dispute could unravel the source of the billionaire's wealth and his worldwide assets because he might be compelled to open his accounts to the courts.

The six-year legal fight began when the EBRD lent the money to Runicom SA, a Swiss-based oil exporter ultimately controlled and owned by Abramovich. The loan was originally granted to a Moscow bank called SBSAgro, then controlled by another Russian tycoon, Alexei Smolensky.

In 2000, SBS-Agro collapsed and the bank assigned the loan to Runicom SA. But when challenged, Runicom SA claimed that it had already repaid the loan to SBSAgro before it folded. Runicom refused to pay.

The EBRD, which specialises in loans to former East European communist countries, has been identifying the assets of Abramovich, Runicom's managing director Eugene Shvidler, who later became chairman of Chelsea, and Eugene Tenenbaum, a Runicom director who led the original negotiations for the loan.

Shvidler and Tenenbaum are Abramovich's closest business partners and are intimately involved in the negotiations over the EBRD's unpaid loan.

Despite Runicom SA's shares being held by nominees, lawyers for Abramovich have admitted to the EBRD that their client owned the company, according to sources close to the bank.

But when the EBRD tried to enforce a judgment obtained in Switzerland recently, it found that Runicom SA had gone bankrupt with the major creditor being the EBRD. Runicom's assets were then transferred to Sibneft.

Sources inside the EBRD are furious at what they see as the arrogance of Abramovich and his Russian executives. They were incensed after a meeting with Tenenbaum, who told them that Runicom/Sibneft had no intention of paying up. One source said that the case is 'still very much alive' and the EBRD would be filing a lawsuit in Switzerland imminently.

Abramovich's associates say they will not pay up unless compelled by law. Their real concern is being forced to disclose their worldwide assets and commercial interests.

EBRD declined to comment.