Akhmetov's Energy Holding Lands Top Western Exec

KIEV, Ukraine -- A top executive at a major United States-based power company with assets in Ukraine has accepted a new high-level post at the energy holding of Ukrainian business tycoon Rinat Akhmetov.

Garry Levesley, who has served as vice president of Virginia-headquartered AES Corporation for the past five years, has accepted the number two job at a promising energy holding owned by Ukrainian tycoon Rinat Akhmetov.
Garry Levesley, who served as vice president of Virginia-headquartered AES Corporation until May 31, has accepted the number two job at Donbass Fuel and Energy Company, Ukraine’s largest privately-owned, vertically-integrated power company.

Levesley is one of the first high-ranking executives from a multinational to join the management team of a company owned by a Ukrainian business mogul. Steve Walsh, another top executive at AES, has stepped in for Levesley to manage AES’s Ukraine operations.

Levesley, who has worked for the past 12 year for AES, which operates more than 100 generation, and 17 distribution companies in 27 countries, sees his new job as Chief Operating Officer and Deputy General Director at DTEK as a step up into a company with a bright future.

“I have never worked for an emerging company before,” said Levesley, a UK national, adding: “I have only worked for multinational corporations, including Royal/Dutch Shell.”

Levesley, now 46 years old, worked at Shell for 10 years before joining AES.

“When I was first approached by DTEK, my initial reaction was ‘sorry, this is not for me. I am quite happy where I am.’ But when I started looking at the company's asset base, I realized they were a sizable player … and the seriousness that they have in terms of improving their operations and bringing in the best business practices.

I realized they were looking much further ahead than the next six to 12 months and have serious plans for the next 10 years to become a leading European and regional player,” he added.

DTEK incorporates 12 coal mines and electricity generation and supply operations in the highly populous and industrialized heartland of Ukraine: Donetsk, Luhansk and Dnipropetrovsk regions.

DTEK was established this year, but Akhmetov has controlled its assets for some time. System Capital Management (SCM), Akhmetov’s principle holding company, has been reshuffling its business structure in the hopes of streamlining operations and increasing the group’s attractiveness to investors. The company has moved quickly to revamp and attract fresh capital needed for modernization efforts.

On Feb. 16, company representatives announced that SCM, which controls assets in various sectors ranging from metallurgy to beer, has shifted all of its energy sector assets into a separate company within the group, namely, DTEK.

The assets had earlier been managed directly by SCM’s top management. Now they will be managed by the newly established DTEK, appropriately named after the industrial region of Donbass, where most of Akhmetov’s assets are located.

With 55,000 employees, DTEK is one of Ukraine’s largest companies in terms of manpower.

Levesley, who has managed AES’s operations in Ukraine and other former Soviet bloc states during the past five years, said DTEK is also Ukraine’s largest privately-owned, vertically-integrated energy company managing assets “potentially worth several billion dollars.”

Annual revenues at DTEK are well in excess of $1 billion, Levesley said, adding that the company accounts for 25 percent of all power produced by thermal generators in Ukraine, and 10 percent of all power produced in the country as a whole.

State-owned nuclear power plants produce nearly half of Ukraine’s power.

DTEK General Director Maksim Timchenko said his company was pleased with the addition of Levesely, “one of the leading Western experts in the energy sector,” to its management team.

Timchenko said the hiring of Levesley “demonstrates the seriousness” of his company to become a leader on the energy market, adding that “a manager of such caliber will serve as a locomotive, ensuring the company’s success on the European energy market.”

Levesley spearheaded AES’s $90-million acquisition of two Ukrainian power distributors – Kyivoblenergo and Rivneoblenergo – in a 2001 privatization tender.

He has since managed AES’s modernization of these power distributors and hopes to spread the benefits of his expertise to DTEK, whose Soviet-built coal and power companies are badly in need of restructuring and modernization.

“They do seem to be serious about cleaning up and modernizing and they have realistic expansion possibilities. This is an exciting possibility for somebody like myself. My job will be to modernize and improve all their operations and advise them on bringing about a growth strategy. I bring solid experience to their team,” he said.

“The goal of the company for the next three years is to transform itself into a topnotch energy company. I would expect me joining the company to be a positive signal that DTEK has ambitions to become a more serious player in the Ukrainian and regional energy market.”

Rumors have spread in recent months within investment circles that Akhmetov was planning to take his companies public, offering stock on a Western trading platform.

Asked if his arrival could help DTEK better prepare for an Initial Public Offering on a Western market, Levesley said: “It is wrong to say I've been brought in as a face for a potential foreign listing. At the moment, there are no firm plans for an IPO or listing.”

“After three years [or so], the shareholders will decide what to do with regards to listing abroad or selling a stake, or to continue being private,” he added.

Yuriy Kubrushko, general director of IMEPOWER Consulting, a Kyiv-based energy sector consultancy, said the appointment of Levesley shows the commitment of DTEK to position the company as a serious energy market player that pays attention to transparency and the efficiency of its operations.

“I believe that potentially DTEK will be in a good position to enter international capital markets through an IPO or other financial instruments. However, it will definitely take some time to properly structure and optimize the operations of the new company,” Kubrushko added.

Source: Kyiv Post