'Tsar' plans $500m deals

David Reuben, the London-based "tsar" who controls the bulk of the Russian aluminium refining industry, plans to invest $500m (pounds 308m) over the next three years in the two plants he controls at Bratsk and Sayansk to expand production and turn them into integrated manufacturers of finished products.

But he says his plans are being thwarted by the Russian government's efforts to undermine the confidence of his financial backers. "We want to expand, and bring much-needed jobs and export earnings to Russia, but its government is doing its best to put these things in jeopardy," he said.

Mr Reuben added that Trans-World, the master holding company controlled by him and his brother, and its associated companies are also in negotiations with two western companies to set up an aluminium can-making factory and an alloy wheel manufacturing facility on sites adjacent to his smelters.

This is the latest run-in between Mr Reuben, who gained control of the Russian aluminium industry by investing hard currency in struggling smelters shortly after the end of the Cold War, and the Russian government, elements of which want to nationalise the industry.

Russian newspapers recently estimated that Trans-World's turnover approached $7bn last year, a figure not disputed by Mr Reuben. He added, however, that he has only made profit margins of "between 2 and 4 per cent on average" in the five years he has been involved in the Russian aluminium business.

In recent weeks, Mr Reuben has been conducting a media campaign to refute what he described as "smears and lies spread by Russian government officials" trying to connect his company with mafia crime rings.

Two weeks ago, he ran full-page advertisements in the Wall Street Journal complaining to US Vice-President Al Gore and Russian Prime Minister Viktor Chernomyrdin about a "craven political power play" being orchestrated to renationalise the aluminium industry.