Russian Oligarchs

Sergey Galitsky Bio: FC Krasnador President and Magnit Co-Owner

Early Life and Education

Sergey Galitsky was born on August 14, 1967, in Lazarevskoye, a resort village now part of Sochi, Krasnodar Territory. His father, Nikolai Gevorkovich Harutyunyan, worked in the administration of Sochi. Until the early 1990s, Sergey bore his parents’ surname, Harutyunyan, later adopting his wife’s surname. Despite being proud of his Armenian roots, he considered himself “75% Russian” and didn’t speak Armenian. In 1993, he graduated from Kuban State University with a degree in finance and credit, after serving in the USSR Armed Forces from 1985 to 1987.

Early Career and Entrepreneurial Journey

While studying, Sergey worked at a commercial bank in Krasnodar and quickly rose to the position of deputy manager. However, in 1994, he left the bank, referring to it as a “money changer.” That same year, he co-founded Transasia, a company focused on wholesale perfume supplies to Russia. The company soon became the official regional distributor of Procter & Gamble.

Founding JSC Tander and Magnit

Entrepreneurial Journey
Entrepreneurial Journey

In 1995, Sergey, along with his partner Alexei Bogachev, founded Tander, later known as JSC Tander. Initially, it dealt with wholesale perfume supplies in southern Russia. However, in 1998, they opened the first retail supermarket, “Magnit,” in Krasnodar. Sergey strategically avoided competing with larger retail chains, establishing Magnit as a convenience store with low prices. In 2003, Magnit OJSC was registered, acquiring 100% of Tander’s shares. By 2018, Sergey remained the largest owner of (35.1%) Magnit shares.

JSC Tander: Details and Background

Details of JSC Tander
Details of JSC Tander

Tander CJSC, based in Krasnodar, Russia, is a retail company with its production facilities. Engaged in the manufacturing of a diverse range of products, Tander is recognized for its involvement in the production and export of both food and non-food items. With a reported employee count ranging between 51 and 200, Tander operates under the leadership of Anna Yurevna Meleshina as its key principal.

Magnit

Food retail chain Magnit
Food retail chain Magnit

Magnit is the largest food retail chain in Russia, with over 28,000 stores in 67 regions of the country.

The company operates in four different formats: convenience stores, hypermarkets, “Magnit Family” stores, and cosmetics stores. Magnit is also a major employer in Russia, with a total of about 348,000 employees.

The company’s logistics infrastructure includes 45 distribution centres and 5,422 trucks.

Magnit is included in the list of the world’s largest public companies (Global 2000 by Forbes) and tops Forbes’ ranking of Russia’s largest private employers.

The company is also unique in that it operates a private-label food production business, manages several plants for growing vegetables and the production of dry food, and owns greenhouses and mushroom complexes, which are among the largest in Russia.

Magnit’s revenue for 2020 was $21.5 billion, with total assets of $13.1 billion and total equity of $2.54 billion. In 2018, Marathon Group acquired an 11.82% stake in Magnit from VTB.

Expansion and Business Ventures

In addition to Magnit, Sergey founded various commercial projects in Krasnodar, including the Art Side advertising agency, the Art Side food factory, and the Kvartal entertainment complex in the mid-2000s. In 2008, he established the Krasnodar football club, FC Krasnodar, playing in the Russian Football Premier League since 2011.

Krasnador Football Club

FC Krasnodar: A Football Journey

Football Club Krasnodar FC
Football Club Krasnodar FC

Founded on February 22, 2008, FC Krasnodar has swiftly become a football powerhouse in Russia, boasting a rich history under the ownership of Sergey Galitsky and the leadership of Chairman Vladimir Khashig. The team, affectionately known as “Byki” or “The Bulls,” proudly plays its home games at the Krasnodar Stadium, a venue with a seating capacity of 35,179. Under the guidance of Manager Vladimir Ivić, FC Krasnodar consistently competes in the highly esteemed Russian Premier League.

The club’s journey to success began with humble achievements, securing the 3rd position in the Russian Second Division, South Zone, in 2008. Over the years, FC Krasnodar experienced steady growth, achieving a noteworthy 5th-place finish in the Russian First Division in 2010.

In the 2013/14 season, FC Krasnodar reached new heights by becoming the runner-up in the Russian Cup. The 2014/15 campaign saw the team secure bronze medals with a 3rd place finish in the Russian Premier League. European success followed in the 2015/16 season when Krasnodar topped the UEFA Europa League group, earning qualification for the Round of 32.

Building on their impressive journey, FC Krasnodar reached Round 16 of the 2016/17 UEFA Europa League. The 2018/19 season marked another stellar performance with a 3rd place finish in the Russian Premier League, securing bronze medals once again. Simultaneously, the club advanced to Round 16 of the UEFA Europa League.

In the most recent 2021–22 season, FC Krasnodar maintained their strong standing in Russian football, securing a 4th-place finish in the Russian Premier League. The team also made a commendable run in the Russian Cup, reaching the Round of 32. FC Krasnodar’s journey reflects a remarkable ascent in the football world, with each season adding to the club’s legacy of achievement and resilience.

Achievement Table:

SeasonAchievement
20083rd position in the Russian Second Division, South Zone
20105th position in the Russian First Division
2013/14Russian Cup runner-up
2014/153rd position in the Russian Premier League (bronze medals)
2015/161st position in the UEFA Europa League group, qualification for Round of 32
2016/17Qualification for the Round of 16 in the UEFA Europa League
2018/193rd position in the Russian Premier League (bronze medals), qualification for Round of 16 in the UEFA Europa League
2021/224th position in the Russian Premier League, Round of 32 in the Russian Cup

Business Success and Recognition

Under Sergey’s leadership, Magnit became the largest retail company in Russia by revenue in 2015. In 2018, he sold a controlling stake of (29.1%) to VTB Bank for 138 billion rubles. Despite stepping down from leadership positions, he retained around 3% of Magnit shares, focusing on managing Krasnodar FC.

Personal Life

Personal Life
Personal Life

Sergey met his wife, Victoria Galitskaya, during university, and they have a daughter named Polina. The exact date of their wedding is undisclosed. Sergey is known for his passion for luxury cars, owning a fleet of vehicles, a personal business jet, and a 104-meter yacht called Quantum Blue.

Superyacht Quantum Blue
Superyacht Quantum Blue

Philanthropy and Recognition

Sergei Galitsky is the president of FC Krasnodar and heads the youth football committee of the Russian Football Union. He received a Certificate of Honor from the President of the Russian Federation in 2017 and holds the title of Hero of Labor of Kuban (2011).

Post-Business Ventures

In February 2018, Sergey sold most of his Magnit shares to VTB Bank, signalling a shift in his life. He established the SN Capital investment fund in June 2018, and in March 2023, he opened a Japanese garden on the Krasnodar stadium park grounds.

Controversies

Magnit Founder’s Sale of VTB Raises Concerns about Entrepreneurial Options in Russia

VTB Bank
VTB Bank

Sergey Galitsky, the founder of Russia’s second-largest retail network, Magnit, announced the sale of 29.1 per cent of the company to VTB, a Russian government-owned bank. Galitsky, a prominent entrepreneur worth $5 billion, was known for building his fortune outside natural resources and for his success in both business and sports, having founded the soccer club Krasnodar.

What was noteworthy was that the buyer was a state-affiliated entity, highlighting the limited options for entrepreneurs looking to exit large businesses in Russia. While official statistics indicated a declining government share in retail, the Magnit deal raised questions about the extent of state influence in the economy. Galitsky’s decision might have set a precedent, suggesting that dealing with a state bank was the most realistic exit strategy for successful businesses in Russia, potentially at a discount. The move underscored the dominance of state involvement in various sectors of the Russian economy.

Sanctions on Sergey Galitsky

Sergei Galitsky carries out commercial activities in sectors of the economy that provide a high revenue part of the budget of the Russian Federation, which is responsible for the war in Ukraine; that is, he was a significant source of income for waging war. 
The regime, with which Galitsky has close ties, is preparing and conducting a war of aggression against Ukraine in violation of the statutory documents of the United Nations, resulting in the commission of crimes against humanity and the genocide of the Ukrainian people.
In this way, he is responsible for the material or financial support of actions that undermine or threaten the territorial integrity, sovereignty, and independence of Ukraine.

Summary

Sergey Galitsky, born in 1967, is a Russian entrepreneur famed for founding Magnit, Russia’s largest food retail chain, and FC Krasnodar, a successful football club. After graduating from Kuban State University in 1993, he initially worked in banking before co-founding Transasia and later Tander, which evolved into Magnit. Under Galitsky’s leadership, the organization expanded to over 28,000 stores nationwide, making it the country’s leading retail company by revenue in 2015. In 2018, he sold a controlling stake to VTB Bank, retaining 3% of shares and focusing on Krasnodar FC. Galitsky, married to Victoria, has a daughter, Polina, and is recognized for his philanthropy.

He established the SN Capital fund later in 2018 and inaugurated a Japanese garden at Krasnodar Stadium in 2023. However, the sale of Magnit shares to a state-affiliated entity raised concerns about limited entrepreneurial exit options in Russia. Additionally, Galitsky faced sanctions for alleged financial support for actions undermining Ukraine’s territorial integrity. Despite the controversies, his impact on Russian retail and football remains significant, reflecting a multifaceted career.

Alexander Harris

Alexander Harris began his career as a journalist. He is one of the founders of the " Russian Oligarchs Tracker Unit ".

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