Published by Global Banking and Finance Review
Posted on July 7, 2025
By Anastasia Lyrchikova and Alexander Marrow
MOSCOW (Reuters) -Russian prosecutors are seeking to seize billionaire Konstantin Strukov's majority stake in major gold producer Uzhuralzoloto (UGC) for the state.
A hearing at the Sovetsky District Court in the Urals city of Chelyabinsk is scheduled for July 8 in a case that marks the latest in a string of asset seizures by the Russian state.
WHO IS KONSTANTIN STRUKOV?
Strukov, born in Russia's Orenburg Region in 1958, worked in mining straight after graduating from Magnitogorsk State Technical University.
Uzhuralzoloto was founded as a Soviet enterprise in 1976 and was privatised in 1993 following the Soviet Union's collapse. Production had almost ground to a halt by 1997, when Strukov became head of the unprofitable enterprise.
A business of the same name was created and assets, including the Svetlinsky gold deposit - the largest in the Urals region - were transferred to it.
The company subsequently went bankrupt and Strukov was able to acquire its underlying assets and shares in a new company for 12.8 million roubles ($162,600).
After that, production restarted thanks to gold deposits it had acquired in the Khakassia and Krasnoyarsk regions.
From 2004 to 2012, UGC's annual output increased to 10 metric tons from three tons. The company has 17 core assets and eight processing facilities across two major regional bases.
Production in 2024 fell by 17% to 10.6 tons year-on-year, due to some mines being closed at the regulator's behest. UGC expects output to increase this year to as much as 14.4 tons.
Strukov, whose fortune is estimated by Forbes at $1.9 billion, was placed under sanctions by some Western countries after Moscow sent troops into Ukraine, including Britain, which has said his work as a director of a company in the Russian extractives sector supported the Russian government.
Since 2000, Strukov has served on Chelyabinsk Region's legislative assembly. He is deputy speaker of the region's parliament and a member of the ruling United Russia party.
WHAT IS THE CASE AGAINST STRUKOV?
The Chelyabinsk court told Reuters that Russia's deputy prosecutor general had filed a lawsuit against Strukov and several other people, accusing them of obtaining property "through corruption".
It did not specify further details, but Russian news agencies reported, citing a law enforcement source, that prosecutors were seeking to convert Strukov's entire stake in UGC to state property.
The Kommersant daily, citing court documents, reported that prosecutors believe Strukov used the bankruptcy procedure and his position as a state official to transfer assets to UGC. According to Kommersant, searches were conducted at UGC offices last week in relation to alleged violations of environmental legislation and industrial safety rules.
The newspaper also reported, citing court documents, that 200 billion roubles of Strukov's assets could be confiscated and that he had used a Cypriot offshore company to conceal his involvement with UGC.
Reuters has sought comment from Strukov through UGC.
Strukov owns a 67.8% stake in UGC, according to company data as of the end of 2024. A company connected to Gazprombank bought a 22% stake late last year and the remaining 10% of shares floated on the Moscow Exchange in 2023 and 2024 in two public offerings.
The central bank suspended trading of UGC's Moscow-listed shares on Friday after they slumped almost 30% in two sessions.
The company said in an investor-focused blog on Friday that protecting minority shareholders' rights was a top priority.
An anonymous comment on that post said: "The casino is safer than the stock market."
IMPACT ON RUSSIA'S BUSINESS CLIMATE?
Foreign companies have grappled with the risk of state seizure since Russia sent troops into Ukraine in February 2022, but Moscow, citing strategic stability and domestic security, has increasingly turned its attention to domestic assets too.
It was not clear why Strukov and UGC were targeted.
Moscow has been sending mixed messages on foreign investment, seeking to present Russia as a viable destination for foreign capital, while also arresting top business figures. Foreign investment has declined sharply since the start of the conflict in Ukraine.
Vadim Moshkovich, the billionaire founder of Russia's top agriculture company Rusagro, has been held in pre-trial detention since late March on charges of embezzlement that he denies.
($1 = 78.7205 roubles)
(Reporting by Anastasia Lyrchikova, Elena Fabrichnaya and Alexander Marrow; Editing by Guy Faulconbridge and Gareth Jones)
Explore more articles in the Finance category
