A superyacht owned by a sanctioned businessman from Russia was auctioned off on Tuesday, the first such sale since governments worldwide began seizing Russian-owned luxury vessels following President Vladimir Putin’s invasion of Ukraine.
The superyacht, the Malta-flagged “Axioma,” was seized by British authorities in Gibraltar in March after the ship’s owner, billionaire Russian steel pipe magnate Dmitrievich Pumpyansky, defaulted on more than $20 million in loan repayments to JP Morgan, Bloomberg reported.
The bank stated that funds owed to it by Pumpyansky’s holding company, Pyrene Investments, could no longer be legally accepted after he was sanctioned by the U.S., UK, and EU. The bank obtained a court order in Gibraltar in July to have the vessel seized and auctioned off to repay the loan.
Before being sanctioned in March, Pumpyansky owned and chaired Russia’s largest steel pipe producer, TMK PJSC. Pumpyansky was one of the oligarchs “closest to Putin,” with a fortune worth more than $2 billion, Reuters reported.
The $75 million yacht has five decks and is 236 feet long, according to Yacht Charter Fleet. There is an infinity pool, a 3-D cinema, a gym, a jacuzzi, and a spa onboard.
Nigel Hollyer, broker to the Admiralty Marshal of the Supreme Court of Gibraltar, stated that there had recently been a “staggering amount” of interest in the vessel, including 100 inquiries and 30 in-person inspections.
He said that two “serious” offers had already been received and that most bids were expected on Tuesday, the New York Times reported.
Bidding closed at noon on Tuesday with 63 bids submitted, a court spokesman stated. The selection process is expected to take 10-14 days.
Prospective buyers came from the United States, Canada, the United Kingdom, Italy, and Turkey, according to Hollyer.
Initially named Red Square, according to Yacht Charter Fleet, the vessel was, at one time, available for charter for as much as $635,250 per week, plus expenses, when it was first built in 2013. According to Hollyer, many who had previously rented the superyacht were U.S. citizens.
JP Morgan declined to comment on whether the bank intended to donate any of the proceeds to help Ukrainian refugees. Some governments, including the United Kingdom, which governs Gibraltar as an overseas territory, have stated in recent months that the proceeds from the sale of seized Russian assets could be used to help Ukraine.
James Jaffa, a lawyer for a firm that specializes in yachts, stated that the ship’s broker, crew wages, the shipyard, and maintenance would have to be paid before the bank received the money it was owed.
According to a spokesman for the Gibraltar Courts Service, what happens to any surplus from the sale after the loan was repaid was “to be determined by the court,” the New York Times reported.
However, a Gibraltar government source told Reuters that any excess funds would likely be frozen rather than handed to anyone other than Pumpyansky.
