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The Moscow investment corporation Partnership recently acquired full control over Primorye shipping giant Vostoktransflot during a Nov. 26 shareholders’ meeting. The event marks the first time in Primorye that such a large company – with the third largest refrigerator fleet in the world – will be run by a team of young professional managers.

“We conducted a successful counter-acquisition,” said 29 year old Partnership General Director Anatoly Milashevich, who was appointed chairman of VTF’s board of directors at the shareholders’ meeting. “And now we need to build the firm anew.”

After 18 months of competition with Moscow company Absolut Invest, which represented American shareholders, Partnership acquired 60 percent of VTF stock.

The first clash between the two companies occurred at a 1996 shareholders’ meeting. Absolut Invest had shares totaling 38 percent, and was sure of a successful takeover. As a result, general director Victor Mistyk — publicly accused at the meeting of corruption and giving out the company’s ships to an American ship operator Trans Ocean on unfavorable conditions — was replaced by Victor Ostapenko, a former captain.

Partnership supported Ostapenko and began to buy VTF’s shares for prices higher than Absolut Invest was willing to pay.

When Milashevich and his team assumed control of VTF, they faced incredible obstacles: During his year as director, Ostapenko added $23 million to the company’s debts. “Had we not taken power, the company would have been bankrupt by December,” said Milashevich, who had Ostapenko replaced with young manager Alexei Dmitrenko at the August meeting.

Milashevich discovered that the previous management was interested in keeping the company in crisis for as long as possible, as it was perfect way to pocket company money. “The extent of the corruption was tremendous, it was open robbery of the company,” Milashevich said.

Every deal was illegal, and one third of sales went to the managers. Another problem was Ostapenko’s incompetence: The Bank of Scotland, which gave Ostapenko a loan, sent numerous notices about VTF’s defaults, but Ostapenko thought that the bank was offering him more money.

Ostapenko, however, denied the accusations. “I did not steal a single ruble. On the contrary, I covered salary debts for our workers.” In his turn, he accused Milashevich of seizing the company by fraud: “He wormed himself into my confidence, learned all our commercial secrets, and then betrayed me,” he said.

Before the Nov. 26 meeting Ostapenko appealed to shareholders in press to oppose Milashevich because of his illegal activities. But at the meeting, when Milashevich repeatedly asked him to openly talk about the alleged activities with the audience, Ostapenko refused.

Gennady Nesov, head of the krai Committee for Shipping, Sea Ports and Transportation said that Milashevich’s team took advantage of the “red directors’” incompetence. “They proved to be head and shoulders above the rest. But we don’t know whether they will be able to handle the company well in everyday life and in difficult competition,” he said.

VTF chief engineer Grigory Vereschaka said the new team has already established stricter control of finances and stronger discipline in the company. “They have higher requirements, but there is a lot of misunderstanding between us: They do not know how to manage shipping yet,” he said.

Ostapenko, however, says that in a year the company will cease to exist, because Milashevich will sell out all the ships and take profits for himself. “He does not care for the people or for the ships, he will pocket all the money,” Ostapenko said.

With over 100 billion rubles invested in VTF, Milashevich is sure that his team will make the giant enterprise function properly. The group graduated from the Moscow Physics and Engineering Institute, and their average age is 27. They were all taught to be professional managers and can apply their knowledge to any business, he said. “Our god is high professionalism.”

Milashevich thinks his team’s precedent will be followed by similar deals with other Primorye companies. “For this damned country the only chance to survive is if someone will take hold of control stock and puts companies in order himself.”

Tiger Securities General Director Andrew Fox, who has been working with the Partnership since 1993, said it is a professional team whose success might be a “catalyst for the good.” Fox does not believe that they can save Primorye’s economy, which is “too big a job,” but said, “It is a movement in the right direction.”