Russian billionaire and former owner of the Chelsea Football Club Roman Abramovich secretly funded the world’s largest cannabis company, investing hundreds of millions of dollars in the U.S. cannabis industry, according to leaked documents and first reported by Forensic News.
With a new worth estimated at $9 billion, Abramovich was sanctioned by the U.K. and the EU after Russia’s invasion of Ukraine. While he hasn’t been sanctioned by the U.S. the Department of Justice obtained a warrant to seize two of his planes back in June.
Abramovich is known for his close ties to Russian leader Vladimir Putin and, according to the leaked documents, has helped to fund the two largest shareholders of multi-state cannabis operator Curaleaf Holdings, headquartered in Wakefield, Massachusetts with a market cap of around $3.08 billion.
The documents were made available from a Cyprio accounting and secretarial firm to journalists and researchers by the Distributed Denial of Secrets, a nonprofit that hosts leaked and hacked data. They assert that Abramovich’s company invested in a number of companies in the American cannabis industry.
Curaleaf previously faced questions surrounding its ties to Russia when the war started, with its executive chairman Boris Jordan acting previously as a prominent investment banker in Russia and previously stating he “once had a close relationship” with Putin. Jordan currently holds approximately 18.2% of Curaleaf and is worth $1.6 billion, according to Forensic News, though he has denied Curaleaf’s ties to Russia.
The documents show that Abramovich was funding Jordan and companies under his control through a British Virgin Islands LLC, Cetus Investments. Tens of millions of dollars in loans were issued to Jordan and companies under his control, which appear to have never been disclosed by Jordan or Curaleaf, according to the leaked documents and the Forensic News report.
“Some of the loans included stipulations that the money was only to be spent on purchasing shares in Curaleaf, previously known as PalliaTech Inc,” the Forensic News report states.
One example in December 2018 shows a Delaware-based company owned by Jordan, Lafayette LLC, received a $14 million investment from Abramovich’s Cetus Investment Limited. The promissory note said the fund must be spent to buy 878,569 shares of stock in PalliaTech. In October 2017, the note was amended to include an additional loan for $10 million, specifically to acquire an extra 418,253 shares of PalliaTech.
According to the report, Abramovich lent around $69 million in 2017 and 2019 to Jordan’s companies. Jordan was also not the only Curaleaf shareholder who was backed by loans from Abramovich’s company. Andrey Blokh, Curaleaf’s second-biggest shareholder, was also financed by Abravomich in a similar scheme, according to the record.
Back in 2016, Cetus Investment issued a $50 million loan to Blokh to buy PalliaTech shares. Blokh also gained a line of credit from Cetus for an extra $14 million for investments in other cannabis businesses in the U.S.
By the end of 2018, Abramovich’s Cetus lent around $140 million to Jordan and Blokh, per Cetus’ internal financial statements. Filings and documents from the U.S. Securities and Exchange Commission also revealed that Cetus lent $85 million directly to Curaleaf. Ambramovich’s investments in Curaleaf also started before the company went public.
Curaleaf confirmed in a statement to Forensic News that both Jordan and Blokh were funded by Cetus.
“As with any young company in its early days of securing capital, shareholders Boris Jordan and Andrei Blokh were raising funds through multiple sources and family offices to grow Palliatech, which later became Curaleaf,” a company spokesperson said. “Cetus was a lender to many businesses around the world. All loans referred to in your email were repaid long before Curaleaf was formed or went public. Curaleaf has no debt with Cetus. We cannot speak on behalf of shareholders.”
It appears that Curaleaf isn’t the only one; The report also revealed that Abramovich invested in a New York-based cannabis Venture Capital firm, Measure 8 Ventures. He also owned $1 million worth of shares in Green Gorilla Inc, and internal statements reveal that Cetus also invested more than $1 million in large U.S. cannabis companies like Eaze and Tilt Holdings.
