March 11 (Bloomberg) -- Leonid Fedun said he’s spent almost $1 billion to return Spartak Moscow to the glory it achieved in his youth, when it was Russia’s top soccer club. The billionaire plans to take the team public after building a new stadium.
A former Soviet army officer who now helps run OAO Lukoil, Fedun has spent about $60 million annually on Spartak, known as the People’s Team. The club won all but one of the first 10 league championships following the collapse of the Soviet Union. It hasn’t secured the title since 2001 and has been surpassed by its Moscow rivals and Zenit St. Petersburg, backed by the world’s biggest natural gas producer, OAO Gazprom.
Fedun, deputy chief executive officer of Russia’s second-biggest oil company, acquired the team eight years ago. He’s spent $500 million on a new 50,000-seat stadium to be completed this year. Revenue has grown from about $4 million to about $60 million during his ownership.
“After 2017, Spartak will increase their revenue maybe by three or four times,” Fedun, 56, said in a Bloomberg television interview. “My dream is to organize the IPO of Spartak in maybe 2017, 2018 and I can get a return on some of my investment.”
Fedun is Lukoil’s second-largest shareholder after CEO Vagit Alekperov and is worth $7 billion, according to Forbes magazine. He said the move to the team’s own facility will help reduce the club’s reliance on its owner.
“My dream is to create a system when Spartak will be able to fund itself,” he said.
Self-sufficiency is important because of new financial rules being put in place by European soccer’s governing body that will limit the opportunity for benefactors like Fedun and other billionaire to bankroll losses.
Fedun backs Gazprom CEO Alexey Miller’s plan to merge Russia’s elite league with Ukraine’s, saying Gazprom’s proposed $5 billion investment in the new competition over five years would help Russian teams meet the break-even rules. The new league would require the agreement of soccer’s governing body FIFA, and regional body UEFA, before being established.
On the field, Spartak has little to show for Fedun’s spending, having won no trophies during the period. It was eliminated from the Champions League at the group stage earlier this season, and is in fifth place in the 16-team Russian Premier League, which is topped by local rival CSKA Moscow.
Win or lose, Fedun said he believes his investment in Spartak is about more than sport, likening it to the philanthropic endeavors of Microsoft Corp. founder Bill Gates.
“Why does Mr. Gates promise 90 percent of his fortune to social program?” Fedun said. “It’s practically the same. For me Spartak is my social mission. It’s the realization of my dreams. It’s very important for me and my family.”
Russian teams including Zenit and Dagestan-based Anzhi Makhachkala, backed by wealthy owners, have been among soccer’s biggest spenders in recent years, luring talent with some of the sport’s biggest salaries. Anzhi pays Cameroon striker Samuel Eto’o a record 20 million euros ($26 million) a year, according to Russia Today.
Fedun said Spartak’s history means the 91-year-old team, which reached the semifinals of all three European club competitions during the 1990s, doesn’t need to pay above market rates to recruit foreign players.
“Spartak is very famous football club,” he said. “We have no problems, for example, like Anzhi. For a lot of foreigners Spartak is a top club, and we have no problem to invite Spanish footballers, or Brazilians, Germans, etc. For my peers in Russia there is a big problem.”
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