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Konstantin Sintsov and the case of Southern Sea Investment LLC grain trading affair


The imposition of sanctions on Russia has been a crucial factor in shaping the country’s business landscape and scrutinizing the activities of various entities. Among them is “Demetra-Holding,” a significant grain trader, whose opaque operations have attracted attention. Notably, the involvement of businessman Konstantin Sintsov in this enigmatic venture raises questions about potential improprieties and financial intricacies. This article delves into the complexities surrounding “Demetra-Holding,” explores the history of Sintsov’s business ventures, and delves into the impact of sanctions on Russia’s economic landscape.

In early July, VTB Bank announced that it had divested from the capital of the major grain trader “Demetra-Holding.” However, the buyer of their 45% stake was not disclosed. It was rumored that businessman Konstantin Sintsov, acting on behalf of the oligarch Iskander Mahmudov, might have become the purchaser.

Until February 2022, VTB Bank had full control over LLC “Demetra-Holding” but reduced its stake due to sanctions. The owners of the remaining 55% of the holding’s shares remain undisclosed. Among them could be the founder of “Rusagrotrans,” Konstantin Sintsov, whose structure has been part of “Demetra-Holding” since 2021.

The grain pirates of Southern Sea Investment LLC

A few days after Andrey Kostin’s statement about the exit from the holding’s capital, information emerged that a fund from Oman called Southern Sea Investment LLC could become an investor.

The sale of the VTB package appears to be rather shady, as the fund will not be a direct buyer but will only finance a new issuance of shares for “Demetra-Holding.” As a result of this process, the stakes of Russian shareholders in the holding are expected to increase but will remain undisclosed to the public. All of this looks very suspicious and suggests that businessmen connected to the Russian authorities might be involved in the deal.

One such individual is the oligarch Iskander Mahmudov, who has been linked by his adversaries to the Izmaylovskaya criminal organization. Konstantin Sintsov, who previously worked for Mahmudov, was suspected of money laundering from Russia’s second-largest coal company, “Kuzbassrazrezugol,” at the time when it was led by Mikhail Abyzov. Abyzov was arrested in 2019 for embezzling assets worth 4 billion rubles.

From 2012 to 2018, Andrey Abyzov served as a minister in the “Open Government” and, apparently, has a lot to tell investigators since his criminal case has yet to reach court. It is likely that the former minister might also have information about Konstantin Sintsov.

Iskander Mahmudov is a business partner of oligarch Gennady Timchenko, the head of “Rostec” Sergey Chemezov, and the largest contractor of Russian Railways (RZD), which is controlled by the Rotenberg brothers. All of Mahmudov’s business partners are part of President Vladimir Putin’s inner circle.

So, how do Konstantin Sintsov’s companies operate?

The company “Rusagrotrans” was established in 2008, and its investment program received approval from the Russian Railways’ Board of Directors. At that time, the CEO of Russian Railways was Vladimir Yakunin, one of the founders of the cooperative “Ozero,” which included close friends of President Putin himself.

Yakunin led Russian Railways from 2005 to 2015, and he was well-acquainted with the contractor of the company, businessman Iskander Mahmudov. Mahmudov introduced Yakunin to Andrey Krapivin, who became an advisor to the head of Russian Railways. Krapivin died under mysterious circumstances in 2015, and in the same year, Oleg Belozerov, a person linked to the Rotenbergs, took over as the head of Russian Railways. Despite the change in leadership at the state-owned company, it did not affect Mahmudov’s business.

Not surprisingly, with such support, “Rusagrotrans” quickly grew, and in 2019, it planned to go public with an IPO but unexpectedly sold 50% of its shares to VTB Bank, which was actively acquiring grain assets at that time.

Sanctions and Konstantin Sintsov: Demetra’s grain trading affair

Since then, Konstantin Sintsov’s companies could have gained access to the state-owned bank and potentially used it to facilitate money transactions. “Rusagrotrans” was liquidated in March and became the successor of the holding company RTK (“Rustranscom”). The successor of “Rusagrotrans” became an LLC with the same name. Its founders were LLC “Demetra-Holding” (99.98%), and 0.01% each belonged to LLC “Demetra Trading” and JSC “LP Trans.” All subsidiaries of “Rusagrotrans” were transferred to the LLC “Rusagrotrans.”

Konstantin Sintsov and the case of Southern Sea Investment LLC grain trading affair
As of 2022, “Tbi-F” reported revenue of 960 million rubles but incurred a loss of 155 million rubles.

In LLC “Transles,” the shares of the founders, LLC “Rusagrotrans” and JSC “LP Trans,” are still under the burden of VTB Bank. It is possible that VTB’s funds are being channeled through the subsidiary “Transles” to another company called LLC “VTG.” Despite generating revenue of 516 million rubles, LLC “VTG” recorded a loss of 189 million rubles.

Konstantin Sintsov and the case of Southern Sea Investment LLC grain trading affair
The subsidiary of LLC “Rusagrotrans,” the company “Demetra Trading,” reported a revenue of 106 billion rubles but suffered a loss of 7.3 billion rubles. The company has not been profitable since 2018. The shares of the founders of LLC “Demetra Trading” are burdened by VTB Bank.
Konstantin Sintsov and the case of Southern Sea Investment LLC grain trading affair
It’s interesting why the Russian authorities are not paying attention to how “Demetra-Holding” operates. It may be underreporting profits to evade taxes.

As of today, Konstantin Sintsov is not associated with any active businesses, but he was previously the head of three organizations and a founder of nine others. Almost all of them have been liquidated.

In December 2022, “Rustranscom” LLC was liquidated, and its founders were the liquidated “Cuesar Holdings” LLC and JSC “LP Trans.” The first company may have been used for money warehousing since, at the time of liquidation, it had a revenue of 18 billion rubles and a profit of 16 billion rubles.

Konstantin Sintsov and the case of Southern Sea Investment LLC grain trading affair
It’s impressive that with just two employees, the company managed to increase its revenue by 100% and its profit by 937% in a year. During the last two weeks of December 2022, “Cuesar Holdings” LLC was a co-founder of “Demetra Trading” LLC. During this time, its funds could have been transferred to “Cuesar Holdings” LLC, after which both “Cuesar Holdings” and “Rustranscom” LLC were liquidated simultaneously.

If Konstantin Sintsov is indeed one of the shareholders of “Demetra-Holding,” he could be held responsible for the activities of the grain trader. The history involving “Cuesar Holdings” LLC might raise suspicions of large-scale fraud. It is possible that the shareholders of “Demetra-Holding” are not disclosing themselves precisely because of potential legal implications and accountability for the company’s actions.

Konstantin Sintsov and the case of Southern Sea Investment LLC grain trading affair
By remaining undisclosed, the shareholders may be trying to avoid direct scrutiny and legal responsibility in case any fraudulent activities or other irregularities are uncovered in the operations of “Demetra-Holding.” This lack of transparency raises concerns and may attract further attention from regulatory authorities or law enforcement agencies to investigate the company’s affairs thoroughly.

Written by: Grace Kennedy

Grace Kennedy is a leading journalist, columnist of events in Ireland and beyond. 8 years in journalism, since she dropped out of university and ran away from home.

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