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 "We don't deny we have excellent contacts," the steely-voiced
Swedish oil trader told Reuters, in what was the first interview of
his 30-year career. "To involve Mr Putin and any of his staff in
this dialogue is speculation."
Seven years on, Tornqvist, 60, is still dogged by the same
speculation, this time provoked by the United States slapping
sanctions on his long-time partner, Gennady Timchenko, one of the
most loyal businessmen to Putin.
The U.S. government says Putin has "investments" in Gunvor and may
have access to its funds, an allegation Gunvor fiercely denies.
Hours after the announcement of the sanctions — designed to put
pressure on Russia for its annexation of Crimea — Gunvor said
Timchenko had sold his stake to Tornqvist.
Now, with a majority stake and 100 percent of the voting shares,
Tornqvist has much work to do to convince his trading partners that
Gunvor can still grow and thrive without Timchenko.
"This is certainly the most challenging moment in Gunvor's history,"
Tornqvist told Reuters on Friday.
The imposing chief executive, an avid sailor with a shaven head,
teamed up with Timchenko to form Gunvor in 2000. The firm has grown
from a niche player in Baltic Sea oil exports into the No.4 oil
trader, handling 3 percent of the world's oil.
Gunvor says 80 percent of its business is unrelated to Russia. It
has poached top traders from firms like France's Total <TOTF.PA>,
bought refineries in Europe and expanded into coal, natural gas and
key Asian markets. With annual turnover of near $100 billion, Gunvor
has 1,600 employees in 20 offices.
"Gunvor is more than 1 country or 2 people," the firm said on
Twitter on Friday. "Gunvor is global."
Yet the U.S. sanctions on Timchenko have brought Gunvor's Russia
ties once again to the fore. On Friday, major U.S. banks and traders
scrambled to understand whether they could continue dealing with the
firm.
Washington did not slap sanctions on Gunvor itself as Timchenko
owned less than half the company, but the Treasury Department warned
Americans to "act with caution" when dealing with companies that may
be controlled "by means other than a majority ownership interest."
(Link to Treasury statement: http://r.reuters.com/fer77v)
FROM RUSSIA, WITH OIL
Tornqvist began his career the way many of the industry's top
executives did: working for a major oil company. At BP <BP.L>,
Tornqvist had a front-row seat to the birth of the modern oil market
in the late 1970s and early 1980s.
He left BP in 1983 and joined Scandinavian Trading Co, an oil
trading venture that AB Volvo had acquired several years earlier,
according to a biography on Gunvor's website. The firm, known as STC,
was that year in the midst of dealing with heavy speculative trading
losses. By 1989, when he left STC, it was scaling back operations.
Tornqvist became managing director of the oil division of
Intermaritime Group Petrotrade, which was part of Swiss oil man
Bruce Rappaport's energy, banking and shipping empire.
Tornqvist teamed up with Timchenko in 1997, and three years later
the two formally launched Gunvor, a name that translates to
"Vigilant in War" in old Scandinavian. His own name, Torbjorn, means
Thunder Bear.
Gunvor began making its name a decade ago by pioneering small
shipments of Russia's fast-expanding crude oil production out of the
Estonian port of Tallinn, one of the only Baltic export terminals at
the time.
The firm grew spectacularly, at one point becoming the biggest
exporter of Russian oil thanks to contracts with state majors such
as Rosneft <ROSN.MM>.
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Timchenko has repeatedly denied that Putin helped him create his
business empire and insisted that contracts were won at competitive
tenders. Putin himself made several statements saying he never
helped Timchenko.
By 2007, Gunvor was already looking further afield, seeking to get
access to oil exports from Nigeria and Equatorial Guinea.
"We are confident our growth will continue but not in Russia,"
Tornqvist said.
In 2012, Gunvor bought its first refinery in Antwerp, the same small
plant once owned by his former boss, Rappaport.
In the last few years, Gunvor ceded its leading positions in Russia
to rivals such as Glencore <GLEN.L> and Vitol, and now focuses on
trading in Europe and Asia.
Yet Russia remains core to Gunvor's success, with investments such
as a major oil products terminal at Ust Luga, a Russian Baltic port.
It is the company's single largest investment, and a lucrative, 25
million metric ton a year gateway for Russia's growing oil product
exports, rivals say.
"He did exactly what all of us did — expand in new markets and buy
industrial assets. And he did it very aggressively," the head of a
major rival house said.
"WE DID IT"
Tornqvist now faces the future as Gunvor's sole majority shareholder
with an 87 percent stake. He said Timchenko's abrupt divestment was
part of a contingency plan that was worked out as the Russia crisis
deepened in recent weeks.
"By Wednesday, we were pretty convinced that the sale was the only
way forward for the company," said Tornqvist.
It is not known where Tornqvist raised the money to buy Timchenko's
stake in Gunvor, whose industrial assets are valued at $2 billion.
Timchenko and Tornqvist had each owned 43.5 percent of the firm,
with the remainder held by employees.
Tornqvist said the deal was priced at a fair value but would not
give any details on financing. Forbes estimated Tornqvist's net
worth at $2.6 billion, making him the 15th richest Swede.
In both his personal and professional life, Tornqvist has not been
easily daunted by disaster.
In May 2013, Tornqvist's huge racing boat capsized in the San
Francisco Bay during practice for the America's Cup, the world's
most prestigious sailing race. A crew member died after being
trapped underwater.
Tornqvist, who did not participate in that race, said at the time
that he was devastated. Three months later, he was on a brand new
boat for another race.
"People didn't believe we will come back but we did it," he said at
the time.
(Reporting by Dmitry Zhdannikov; editing by Jonathan Leff and
Tiffany Wu)
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