The “Forbes” magazine evaluated owner of “Mika Limited” company Mikhail Baghdasarov’s financial circulation as 200 million dollars. The oligarch assures that that is not the real amount because he gets 108 million dollars from the “Armavia” airlines in one year alone and 87 million dollars from the benzene business.
“Many people think that if the circulation is 200 million dollars, then the profit has to be 20-40 million dollars. However, that’s not so. The profit from the benzene market is 1-2%. We are still investing in the airline company and not getting anything. “Armavia” suffered financial losses worth 600 thousand dollars in February alone. This is not a clothing store for us to raise the price by 100-200% and then make a 80% discount. There are no discounts in a large business,” says M. Baghdasarov.
It’s clear that things are not looking too good for “Armavia”. But the company is adding more flights because it has promised the government to increase the number of flights by 50. Mikhail Baghdasarov assures that he will have that many flights within the next two to three years.
“At the present, we are negotiating with Georgia for transporting cargo. We are establishing a business in order to have the Yerevan-Tbilisi-Amsterdam, Yerevan-Tbilisi-London flights. We have a shortage of passengers in both countries. But if those two combine, that will solve the problem. Besides that, Georgia will have the chance to supply cheap aviation kerosene,” says the businessman. What’s interesting is that, despite the fact that “Air France” deprived “Armavia” of the right to have the monopoly, Baghdasarov considers “Air France” his colleague and not his competitor because “working with “Air France” will raise the reputation of “Armavir”.”
Baghdasarov looks at the gas price increase from the business perspective.
”As far as I know, gas will be much cheaper in Armenia than in Azerbaijan or Georgia, so our products have to be more competitive. The gas price increase will not affect export because the prices will go up in Armenia and in Georgia at the same time. Georgia doesn’t have cement, so it will buy it from us,” says the oligarch. The cement produced by “Mika Limited” will not reduce in number, but as to how much Armenians will have to pay for cement, that is a different story.
M. Baghdasarov assures that at the present, he has buyer potential for all his companies, but he isn’t planning on selling the companies until “he doesn’t fix things up”(he did this to “ArmEconomBank” by selling the bank’s supervisory packet to the Russian “Vneshtorgbank”). He says that it is very likely that he will sell “Armavia” in the future, but denies the rumors that he will sell it to Gagik Tsarukyan. According to Baghdasarov, the future owner of “Armavia” will not be from Armenia.
Based on what Baghdasarov says, you can come to the conclusion that his business is not that profitable. Perhaps that is one of the reasons why he is planning on entering another market by making investments for oil. In his words, that is going to be a new factory and has nothing to do with “Nairit”.