Why was that Russian billionaire in Charlotte? He was looking in on his investment

North Carolina Gov. Pat McCrory, left, embraces Norwegian entrepreneur Jostein Eikeland, founder, chairman and CEO of Alevo Group, during the Alevo Energy global launch and manufacturing facility opening in Concord, N.C., Oct. 28, 2014.
North Carolina Gov. Pat McCrory, left, embraces Norwegian entrepreneur Jostein Eikeland, founder, chairman and CEO of Alevo Group, during the Alevo Energy global launch and manufacturing facility opening in Concord, N.C., Oct. 28, 2014. Alamy Stock Photo

Russian billionaire Dmitry Rybolovlev’s luxury jet generated global intrigue when it landed in the swing state of North Carolina days before the election and at nearly the same time as candidate Donald Trump.

Asked why Rybolovlev’s Airbus 319 flew in at least twice to Charlotte, his spokesman would say only for “a business meeting.” And now it’s clear: Spokesman Brian Cattell confirmed Tuesday the Russian oligarch’s family trust has invested in a billion-dollar company in Concord, North Carolina, called Alevo.

And at least three of Rybolovlev’s former associates from Russia have been installed as company leaders, McClatchy has learned. One of those Russian associates was involved in a criminal investigation in Belarus and Russia. The chairman of the company also faced questions about his taxes in Norway.

Alevo is headquartered in Switzerland, where Rybolovlev has part of his global business empire. Alevo plans to make giant high-tech batteries that store excess electricity generated by power plants. It has fallen far short of initial production targets despite its significant startup costs.

For months after the overlap of the Rybolovlev and Trump jets on the Charlotte tarmac, the Internet was abuzz with speculation. Was Rybolovlev, who had bought Trump’s Palm Beach mansion for $100 million in 2008, shadowing Trump, first in Las Vegas, then in Charlotte?

Rybolovlev’s jet, with the recognizable call letters MKATE, had been photographed in Charlotte last April 21 and then again on Nov. 3, when it had stopped briefly in Concord and then overnighted in nearby Charlotte — because of meetings now known to involve Alevo officials.

Rybolovlev is known in Russia as “the Fertilizer King” and was the chief shareholder in Uralkali, which at one point controlled a fifth of the global production of potash, a natural fertilizer. He sold his Uralkali stakes for $6.5 billion in June 2010.

Three Russian executives from the company Uralkali are now executives at Alevo, which in February won more than $10 million in staggered tax incentives from North Carolina to prevent it from moving to China.

McClatchy has learned that three of Rybolovlev’s former associates spent the night in Charlotte on Nov. 3 — Kuzma Marchuk, formerly a top Uralkali financial officer; Elena Samsonova, once Uralkali’s human resources chief; and Mikhail Sazanov, a close financial adviser to the oligarch and sometimes director of Rybolovlev’s offshore companies that were ensnarled in his bitter divorce.

Two of those associates – Marchuk and Sazonov – are now directors of Alevo. And on March 21, about a month after it won the tax incentives from North Carolina, Alevo announced that it had appointed Vladislav Baumgertner its new CEO.

Baumgertner was CEO of Uralkali when Rybolovlev, as its largest shareholder, guided the company through a listing on the London Stock Exchange.

Baumgertner was also the subject of a high-profile corruption probe in Belarus and Russia. He was arrested in Minsk in August 2013, put in solitary confinement and eventually placed under house arrest in what Uralkali called political persecution for ending an export partnership in Belarus.

Russia sought Baumgertner’s extradition from Minsk later that year, and in November 2013 he was sent back to Moscow and placed under house arrest. He was released on bail 11 months later. The Russian news agency Tass reported on Feb. 23, 2015, that criminal charges against Baumgertner had been dropped.

So why didn’t Rybolovlev just acknowledge why he was in North Carolina?

“The Rybolovlev family trust has a number of diverse business interests, of which its holding in Alevo is but one. It does not publicize its private business activities, and in most cases it would in fact be inappropriate for it to do so,” Cattell said. “As an investor in a private company, neither the trust nor the company has any obligation to disclose this holding. At the same time, however, the trust has never sought to keep it secret.”

Cattell confirmed that Rybolovlev had previously visited the company’s facility in Concord “but has not, and will not, provide a running, public commentary on private meetings.”

Norwegian Jostein Eikeland, once the CEO of Alevo, is now its executive chairman. He moved aside for health reasons last May and Per Dybwad, a Swiss executive, stepped in as interim CEO. Dybwad became a director of Alevo when Baumgertner came in as the current CEO.

Eikeland is a regular fixture in the Norwegian business media because two of his companies have spectacularly gone bust.

These include a software company in the dot-com crash of 2000-01 and another company, TMG International, that went broke in 2008. Eikeland said at the time that he lived in Switzerland and the United States, and therefore was not liable for the nearly $14 million in taxes that Norway said he owed.

A spokesman for the Norwegian Embassy in Washington said there did not appear to be any outstanding warrants against Eikeland in Norway.

Eikeland and his passport appear in the Panama Papers, the trove of 11.5 million documents about secret offshore companies set up through the Panamanian law firm Mossack Fonseca. The leak of the law firm’s documents generated stories last April by McClatchy and global partners, organized by the International Consortium of Investigative Journalists.

Eikeland set up a trust for himself and his family in mid-2007, according to Mossack Fonseca documents. He also set up related offshore companies in his name that transferred stocks and money among a web of related offshore companies.

The emails with Mossack Fonseca lawyers, also in the leaked database, suggested the need for his trust was urgent.

Alevo’s marketing chief, Scott Schotter, declined to discuss the offshore companies but said Eikeland had asked earlier to step down as CEO because of health problems “but he has now fully recovered.” He also said, “Mr. Eikeland is not tax liable to Norway and has not been for a number of years.”

The Norwegian news outlet Dagens Naeringsliv reported in August 2016 that a Norwegian drug trafficker is among Eikeland’s investors in Alevo. The report said that when police there in December 2013 arrested Gjermund Cappelen, who was accused of running a hashish cartel, they found he owned 14,000 shares of the privately held Alevo. Schotter, the marketing chief, said, “Mr. Cappelen is not a shareholder in Alevo.”

Fortune magazine’s Russian-language publication said last week that Rybolovlev had invested about $35.2 million in Alevo, but company officials and the family spokesman neither confirmed nor denied that number.

Alevo, pronounced A-lay-vo, takes its name from a combination of letters from the first and last names of the inventor of the electrical battery, Alessandro Volta.

But why Charlotte? The battery company made its first splash in the Charlotte area in April 2014, when it spent $68.5 million to buy a massive former cigarette plant that Philip Morris had closed in 2009. Alevo later sold the property and became its tenant.

The company initially provided few details of its plans, but in October of that year it disclosed its name, Alevo, and its goal to build 40-foot battery modules, known as GridBanks. Then-N.C. Gov. Pat McCrory and other officials were on hand for the announcement, although the Swiss-based company did not receive any incentives at that time.

Alevo had joined competitors chasing a holy grail of the industry: how to store energy, which generally must be consumed as it is generated. But in February 2016, The Charlotte Observer reported that the company was moving at a slower pace than expected.

At the time, the company employed about 140 people in Concord, not the 500 it had projected. The first of its battery modules had yet to be produced, and unpaid contractors had filed $4.3 million in liens against the company, which said it would settle the claims with new financing.

Then in February 2017, Alevo announced an expansion of its Concord production plant that will add 200 jobs over five years and more production lines, aided by state and local incentives. The company said it would invest $251 million in the facility.

Cabarrus County commissioners and the Concord City Council approved performance-based tax incentives totaling about $10.5 million, while the state’s Economic Investment Committee approved up to $2.6 million in job-development reimbursements. The money will be paid over 12 years if the company meets its targets.

In documents outlining the incentives package, Alevo said it had an offer from a Chinese firm to move production to Fuyang, China. Securing state and local incentives played a significant role in deciding to stay in North Carolina, the documents added. Rybolovlev is not mentioned in the documents.

Concord City Manager Brian Hiatt, who sat in on at least one Alevo incentive meeting, said he was unaware of any involvement with Alevo and Rybolovlev.

“I’ve never heard anything about that,” Hiatt said, adding he was unfamiliar with any alleged tax issues Eikeland had in Norway or a corruption probe of Baumgertner. Hiatt said Cabarrus Economic Development Corp. had taken the lead in the negotiations.

Robert Carney, executive director of the corporation, said the group was unaware of Alevo’s relationship with Rybolovlev and that county officials had worked with Alevo’s North American leadership as well as consultants. Beth Ann Gargan, of the N.C. Commerce Department, said the state never had any involvement or communication with Rybolovlev, either.

“The company has the responsibility to commit to both tax investment and job creation,” Carney said. “ . . . Once that has been done and the company has paid their taxes, only then are incentives disbursed.”

Alevo now has 215 employees in Concord and has said it will hire for jobs in manufacturing, engineering, maintenance, logistics and supply chain. The first GridBank unit was cleared in December for delivery to Hagerstown, Maryland, in January.

“It’s exciting that a global company like Alevo chooses to manufacture its cutting-edge energy storage products right here in North Carolina, in the heart of one of our state’s strongest manufacturing regions,” N.C. Gov. Roy Cooper said in a statement at the time.

Greg Gordon in Washington and The Charlotte Observer’s Adam Bell in Charlotte contributed to this article.

Kevin G. Hall: 202-383-6038, @KevinGHall

Rick Rothacker: 704-358-5170, @rickrothacker

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