Peering into the mid-morning darkness from his sixth-floor office on Russia’s Kola Bay, Vitaly Orlov strains to see the new factory he’s just built across the water, his view obscured by a creeping cloud bank that shrouds the Arctic seascape in impenetrable gray.
The $30 million structure is the crown jewel of Orlov’s Murmansk-based Norebo Holding JSC. Set amid rows of aging tenements and a wooden church, it was built to service Norebo’s fleet of fish trawlers that together hauled in almost 11 percent of the 4.75 million metric tons (5.24 million U.S. tons) the Russian Federal Fisheries Agency says were caught by Russian fisherman last year.
“I’ve only ever been sure of one thing -- that my life will always be tied to the north and the fishing industry,” Orlov, 51, polite and deliberate, pocket square tucked into a tailored suit, said in his first foreign media interview.
From that modest goal, Orlov has built a fortune that the Bloomberg Billionaires Index values at $1 billion, benefiting from the colliding forces of global trade and sanctions that today define Vladimir Putin’s Russia. While his business derives as much as 60 percent of its sales from outside the country, it’s also seen a surge in domestic consumption as sanctions limit food imports.
Arctic Calling
In the Nov. 8 interview, Orlov explained how the plant fulfills a lifelong aspiration to create a fully integrated global fishing operation. Imported Icelandic equipment will process 15,000 of the more than 500,000 metric tons of cod, haddock and other bottom-dwelling fish Norebo catches, packages and ships annually across the country’s 11 time zones and beyond.
Orlov took control of Norebo last year when one partner sold his share of the operation back to him, and a second was sentenced for trying to extort a stake of his own. The closely held business had $600 million of revenue in 2015, according to Orlov, and has $450 million of net debt issued to fund expansion and consolidate ownership. As a benefit of its dependence on exports, Norebo derives most of its revenue in foreign currencies and has most of its operating costs in rubles.
“He has an absolutely stable business with good margins,” said Eduard Klimov, who runs Fishnews, a research group and news portal based in the far eastern Russian city of Vladivostok. “Fish are a renewable resource that people will always eat.”
Bulldozed Imports
When Putin lashed out at the West three years ago for sanctioning the annexation of Crimea from Ukraine, he banned food imports from countries that had lined up against him. Tons of imported food was gathered, displayed and bulldozed in a global display of defiance.