Vagit Alekperov’s Galactica Super Nova yacht, built by Heesen Yachts.
Updated on April 7 with comment from Heesen Yachts, Lürssen and Dutch Customs, and on April 11 with further information on Alekperov’s ownership of the Galactica yacht.
Yachts owned by Russian billionaires have been in the spotlight since Russia’s invasion of Ukraine on February 24. But there has been far less scrutiny of the shipyards and companies that build the enormous vessels. That may be about to change after the Dutch government blocked 14 Russian-owned yachts on Wednesday, including 12 that were still under construction at five shipyards.
One of the largest superyacht builders in the country is Heesen Yachts, based in the city of Oss. But what sets Heesen apart from its neighbors is the identity of its owner: oil & gas mogul Vagit Alekperov, currently the fourth-richest person in Russia with an estimated net worth of $20.7 billion.
A former oil rig worker in the Caspian Sea, Alekperov served as deputy minister of oil and gas in the last Soviet government before founding oil giant Lukoil in 1991 as a state-owned enterprise. He privatized it two years later before taking it public with a secondary listing on the London Stock Exchange in 2002, and the firm now produces 2% of the world’s oil. Alekperov has not been sanctioned, likely because he is considered to be relatively independent by the West and is viewed as a counterweight to state-owned Rosneft’s sanctioned boss, Igor Sechin. (The London Stock Exchange suspended trading of both Lukoil and Rosneft on March 3, citing “recent sanctions in connection with events in Ukraine.”)
According to corporate records in Cyprus, Alekperov owns Heesen Yachts through his Cyprus-based holding company Morcell Ltd. Morcell is owned by another Cyprus-based firm, Vela Investments Limited, which was previously based in the British Virgin Islands. Vela is owned by the Verona Trust, a trust in the British crown dependency of Guernsey. According to Lukoil filings with the London Stock Exchange, “the Verona Trust is a discretionary trust of which Mr. Alekperov and his family are the sole beneficiaries.” He reportedly purchased Heesen from its founder, Frans Heesen, for $150 million in 2008.
Heesen is one of the world’s largest manufacturers of superyachts, luxury ships longer than 130 feet. It recorded $216 million in net revenues in 2020, according to the latest annual report available for its parent company Morcell. Forbes values Heesen at an estimated $280 million, based on an analysis of publicly traded competitors.
A source familiar with Heesen told Forbes that the situation at the company is “somewhat tricky” due to the Russian invasion of Ukraine, and that 2022 “will not be a great year” for the company. Two Russian members of Heesen’s supervisory board stepped down on March 9 due to “developments of the current international situation in Ukraine.”
A spokesperson for Heesen told Forbes that the company is “financially independent” and is “managed by a professional management board with an independent supervisory board.” They added that Heesen “only reports directly to its sole shareholder, Morcell Ltd” and that Alekperov “does not actively or directly manage our business in any way.”
“There will be serious repercussions for yards,” says Benjamin Maltby, a partner at London-based law firm Keystone Law who focuses on superyachts. “They’ve suddenly been put in a very difficult position, they’ll be obliged to deliver products or provide certain services to the vessels. They’re in the dark at the moment.”
That applies both to yachts that have been frozen or seized as well as any projects on order from sanctioned oligarchs. Eight yachts owned by sanctioned Russian billionaires have been frozen or deregistered since the Russian invasion of Ukraine on February 24—meaning that the owners cannot access them and they cannot sail—but only one, Viktor Vekselberg’s Tango, has been formally seized and confiscated. Collectively, the nine yachts are worth $1.5 billion.
Heesen has built at least four yachts for two Russian billionaires, including two vessels owned by alcohol and cigarette magnate Igor Kesaev and another two owned by Alekperov himself. He’s known to be the owner of the 230-foot Galactica Super Nova yacht, which was custom-built by Heesen in 2016 and features a beauty salon, swimming pool, beach club and room for up to 12 guests. It’s registered in the Caymans Islands and worth $67 million, according to VesselsValue. It was last seen off the coast of Montenegro on March 2 and reportedly turned off its tracking system, making it difficult to locate and possibly violating international maritime regulations.
But the 2020 annual report for Morcell also reveals a second yacht owned by Alekperov. A subsidiary in Malta, Super Waves 34 Ltd., owns the 114-foot Space, formerly known as Galactica Plus. Built by Heesen in 2012, Space is registered in Russia and was last seen in Tuzla, Turkey on April 7. Super Waves 34 Ltd. was dissolved on October 27, 2021 according to the Malta Business Registry, but the firm was owned by another Malta-based company, Waves Holdings Ltd, which is still active and owned by Morcell and Alekperov.
Russians own 9% of superyachts in the world, a distant second to Americans (23%) but ahead of owners from Greece, the United Kingdom and Italy, per a 2021 report by SuperYachtTimes. When it comes to yachts under construction, 19% are being built for American clients and 14% for Russians. According to yacht valuation experts VesselsValue, 2021 was a banner year for the superyacht industry with 887 sales recorded, 77% higher than 2020 and more than double the amount in 2019.
But shipyards that have profited from record demand could now be facing a slowdown due to a wave of asset freezes targeting Russian oligarchs and their yachts. “Most large yacht builders will have some exposure to Russian clients and will be feeling various degrees of financial hardship,” says Sam Tucker, head of superyachts at VesselsValue.
Lürssen, one of the biggest players in the industry and the builder of the world’s largest yacht—sanctioned Russian billionaire Alisher Usmanov’s 512-foot, $588 million Dilbar—is rumored to have 10%-20% of its order book for new yachts exposed to Russian clients. (A spokesperson for Lürssen declined to comment but confirmed that none of its clients are on sanctions lists.) According to Keystone Law’s Maltby, shipyards that built the largest yachts are most exposed to Russian buyers, who have historically tended to buy the largest yachts on the market. That means they could be more at risk from a lack of buyers for yachts that have been frozen or seized.
“The larger the yachts they’ve historically built, the more exposed they are,” he says. “The financial viability of a yard is a key consideration when you’re thinking about which yard to build in. Yards going bust is a common problem.”
Heesen currently has seven yachts under construction, including two—Project Jade and Project Akira—that are for sale at $43 million and $52 million, respectively. Galactica, another yacht being built by Heesen and formerly known as Project Cosmos, is expected to be delivered this month is the latest addition to Alekperov’s luxury fleet. It’s owned by Malta-based Long Island Ltd, which is owned by Waves Holdings Ltd, a subsidiary of Morcell. The world’s largest and fastest yacht built entirely out of aluminum, the 263-foot Galactica features six cabins for 12 guests as well as a beach club, a beauty salon, a steam room, a swimming pool with a waterfall and glass bottom and a helipad that transforms into an outdoor cinema.
It’s unclear if any of these were among the 12 Russian-owned yachts frozen by Dutch authorities. A spokesperson for Heesen told Forbes that they confirmed with Dutch tax and customs authorities that “none of the yachts at [Heesen’s] shipyard have been arrested and none of [their] clients are on any sanctions list.” A press officer at Dutch Customs told Forbes that they cannot divulge the owners of the frozen yachts.
In a letter to the Dutch parliament, foreign minister Wopke Hoekstra said that the government formed a working group with 15 shipyards and five luxury yacht dealers and that customs and Dutch Coast Guard officials had visited all of the country’s shipyards. Given its size, Heesen is likely among the 15 yards in the working group.
The letter also said that one of the frozen yachts “is nearing completion” and took its first trial run on April 2 “under customs supervision.” That could be a reference to Galactica, which was last seen in the Dutch port of Harlingen on April 2, reportedly for final outfitting and sea trials. The ship is already registered in the Cayman Islands. If it’s indeed owned by Alekperov, then he’s unlikely to see his new boat anytime soon. The new Dutch measures mean that any yachts owned by Russians, even if they aren’t sanctioned, are stuck in shipyards and “may not be supplied, transferred or exported at this time.”
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