Boris Lozhkin

Borys Lozhkin
Борис Ложкін

Lozhkin in March 2011
Head of the Presidential Administration of Ukraine
In office
10 June 2014 – 29 August 2016
Preceded by Serhiy Pashynskyi (acting)
Succeeded by Ihor Rainin
Personal details
Born (1971-10-23) October 23, 1971
Kharkiv, Ukrainian SSR, Soviet Union
Nationality Ukrainian
Spouse(s) Nadezhda Shalomova
Children Anastasia (b. 1994)

Borys Lozhkin (Ukrainian: Борис Євгенович Ложкін; born on October 23, 1971 in Kharkiv, Ukrainian Soviet Socialist Republic). Secretary of the National Investment Council (pro bono), deputy Head of the National Reform Council (pro bono), supernumerary advisor to the President of Ukraine, Head of the Presidential Administration of Ukraine[1](June 10, 2014 – August 29, 2016), the head of the Chairman of the Board and President of UMH group,[2] a multimillionaire, and a media manager. He ranks among the top-30 of the most influential media managers in the CIS countries (according to RBK[3] and is a member of the board of WAN-IFRA.[4]

On 29 Aug 2016 Ihor Rainin replaced Lozhkin as Head of the Presidential Administration of Ukraine.[5]

Early life

Lozhkin was born on October 23, 1971 in Kharkiv (Ukraine, former USSR country).[6][7] In 1985 (at the age of 14) concurrently with education started journalistic career as a string correspondent in "Leninskaya smena" and “Vecherniy Kharkov” newspapers. In 1989 he launched his own entrepreneurial activity by creating in Kharkiv of a newspapers and magazines sales network. In a year, he invested his first significant capital into the commercial newspaper "ATV", became its publisher and editor-in-chief.[7]

Business activity

Boris Lozhkin and Petro Poroshenko
Boris Lozhkin in the Verkhovna Rada

In the spring of 1994, Lozhkin gathered editorial stuff and started preparations for the publishing of "Telenedelya" newspaper, its first edition was issued in Kharkov on October 27, 1994. The publication became the first TV-guide newspaper in Ukraine. Currently celebrity magazine "Telenedelya" ranks among TOP-10 major printed media brands in ex-Soviet space[8] (#1 in Ukraine, No. 6 in Russia in terms of sales ratings) with an audience of 5.2 million readers.

Public award "TV star" established by "Telenedelya" magazine is the first and only nationwide public rating of TV products and TV person where winners are elected by means of viewers' voting. In 2000, the year when Lozhkin founded UMH group, aggregate circulation of his publications reached almost 58 million copies. Currently the media holding is Ukraine's major publishing company, aggregate circulation of its publications constitutes over 115 million copies. In November 2003 UMH entered Russian market: Boris Lozhkin founded “Populyarnaya pressa” (“Popular press”) publishing house. In a couple of years UMH built one of the broadest regional networks that embraced 30 cities.

In 2006 Lozhkin created ”Tvoya pressa” (“Your press”) company that later became Ukraine’s major periodicals and associated goods sales network. In 2008 UMH Group under the auspices of Boris Lozhkin was the first Ukrainian media company to carry out private stocks placement on Frankfurt Stock Exchange gaining 45 million US Dollars against 15% of stocks and achieving capitalization of $300 million.[9] Since the first radio station was launched in 2001, UMH Group became one of the largest holdings in Ukrainian radio market with daily audience of 3 million persons. In the second half of the millennium's first decade Internet became an important activity area of the UMH Group. In terms of audience and commercial revenue the group is the No. 1 player in Ukraine.

Currently the resources cover around 50% of Ukraine's Internet users with the group's share in the market for Internet commercials constitutes 29%. In terms of reach UMH Group ranks among TOP-5 companies that operate in Ukrainian market, the list also includes such international corporations as Google, Mail.Ru and Yandex. UMH portfolio of web projects accounts for about 20 popular resources including such high end projects as Korrespondent.net, bigmir.net, i.ua, football.ua.[10] In 2010 the president of UMH Group Boris Lozhkin concluded agreements with Forbes Media that allowed UMH Group to develop in Ukraine projects under Forbes trademark. First edition of Forbes Ukraine magazine was published in March 2011[11] and Forbes.ua web site was launched in September 2012. Miguel Forbes admitted that Ukrainian Forbes ranks among company's TOP-5 license projects.

In 2011, Lozhkin concluded a strategic agreement with Conde Nast publishing house that stipulated launching in Ukraine of Vogue, GQ, CN Traveller and other projects. Vogue magazine has been published since March 2013.[12] In April 2011 Boris Lozhkin in partnership with Petro Poroshenko purchased KP Media holding from Jed Sunden,[13] its portfolio included such market leaders in respective segments as “Korrespondent" magazine, news resource korrespondent.net and information portal bigmir.net.

As of September 2013, UMH Group controls the portfolio of over 50 brands with leading positions in Internet, radio and press markets in Ukraine and ranking among TOP-10 Russia's publishing market players.[14] According to "RBK.Ratings" the media holding ranks among TOP-15 major media companies within former Soviet area.[15][16]

UMH Group sales deal

In June 2013, Lozhkin announced the sale of 98% of the UMH Group's shares to the VETEK group of companies.[17] Expert estimated the transaction value at $450–500 million. According to Forbes Ukraine estimations, the sale of UMH Group ranked among the top 10 largest M&A deals of the first semester of 2013 with an estimated value of the transaction constituting $410 million and EV/EBITDA multiplier constituting 13.7.[18] Until the deal is closed, all UMH stocks belong to former shareholders and remain on escrow account of a British legal company.

During 2012, Lozhkin sought investments to develop the company. Having explored world stock market situation, he suggested that UMH Group board of directors work with private investments. Ultimately, having looked into a number of different offers, UMH Group shareholders opted for the VETEK group offer since it allows attraction of additional resources for more intensive development of the company.

The transaction to be completed in March 2014, but in early November 2013th Boris Lozhkin announced the early closing of the transaction on the sale of the company VETEK 99.9% of UMH group. All financial obligations to the transaction have been fully implemented.[19] According to Boris Lozhkin, UMH group's shareholders and partners are satisfied with the deal."

In 2014 Austrian authorities opened a money laundering investigation into the UMH Group's share sale but closed it due to the reluctance of the Prosecutor General of Ukraine Office of to provide information.[20]

Commenting on future plans, Lozhkin said, "I would very much like to build a company maybe even larger than UMH. As to mass media, it will be a hard task to accomplish due to small market size, but it is a practicable aim for a company that operates, for instance, in electronic commerce."[21]

Public activity

In 2003, Lozhkin became a member of the Council of Entrepreneurs under the Cabinet of Ministers of Ukraine board. from 2004 to 2006, he was the President of the Ukrainian Association of Press Publishers. In 2006, he joined the board of WAN-IFRA in 2006[4] and became a member of the Federation of Media Industry Employers of Ukraine Presidium in 2012.

In 2012, Lozhkin initiated and organized the World Newspaper Congress WAN-IFRA in Kiev.[22] In 2013, he delivered a speech during the WAN-IFRA Congress in Bangkok as the only speaker representing former members of the Soviet Union.[23]

Awards and accomplishments

In 2003, Lozhkin won the "Man of the Year" award as the "Entrepreneur of the year" in Ukraine[24] and ranked among the top-100 most influential Ukrainians according to "Korrespondent" magazine.[25]

Lozhkin is a Candidate of Philological Sciences. He is a Merited Journalist of Ukraine.[26]

In 2008, he won the Russian nationwide award "Russia's best media manager" for the "Successful company's open capital market entrance"[27] In the same year, he won the Ukrainian competition "Entrepreneur of the year," which is a part of Ernst & Young's Entrepreneur of the Year® Awards.

In 2013, Lozhkin was awarded the Diploma of the Federation Council of Russia for a significant contribution to the development of mass media in Ukraine and strengthening good neighbor relations between Russia and Ukraine. The Diploma was presented in Moscow by Valentina Matviyenko.[28] With a wealth of $126 million, he ranked 101 in Focus magazine's 2013 list of Ukraine's richest people.[29] In the same year, he ranked in the top 30 of the most influential media managers in the CIS countries.[3]

Head of the Presidential Administration of Ukraine

Appointment

On June 10, 2014 President of Ukraine Petro Poroshenko appointed Boris Lozhkin Head of the Presidential Administration.[30]

Lozhkin saw this as an opportunity to apply the management skills he developed as a result of two decades of managing a large and successful company to improve the system of public administration in Ukraine.[31]

New approach to the state HR policy

During the 2nd half of 2014 the Presidential Administration of Ukraine was hiring private sector managers and foreign state servants with a positive experience of reforms for public service posts.

With the assistance of Boris Lozhkin high qualified top managers such as CEO of Microsoft Ukraine Dmytro Shymkiv (Deputy Head of the Presidential Administration, responsible for reforms) and a partner of a prominent law firm “Vasil Kisil & Partners” Oleksiy Filatov (Deputy Head of the Presidential Administration, responsible for the judicial reform) were appointed to the Presidential Administration in 2014.

In the end of 2014 the Presidential Administration accepted the plan of Lozhkin to appoint professional foreign technocrat managers to positions in government and other state institutions. The staff of Cabinet of ministers approved by Verkhovna Rada on December 2, 2014 included: ex- US citizen Natalie Jaresko (Minister of Finance), ex-citizen of Lithuania Aivaras Abromavicius (Minister of Economic Development and Trade) and ex-citizen of Georgia Alexander Kvitashvili (Minister of Healthcare)

The new approach to HR policy introduced by Lozhkin was to “infect” state authority with people with the new mentality, new way of thinking.[32]

“I consider the experiment with appointments of the foreign managers the strongest and most successful reform of the Presidential Administration. This definitely reanimated state HR policy and the very system of state authority”, says Vladimir Fesenko, political scientist.[33]

By late 2015 an expression “Reforms special forces” became widely used by Ukrainian journalists. The term describes a team of foreign reformers in Ukrainian state authority invited on the initiative of Boris Lozhkin who were admitted to Ukrainian citizenship. The “Forces” include Natalie Jaresko – the Minister of Finance, Aivaras Abromavicius – Minister of Economic Development and Trade, Gia Getsadze – Deputy Minister of Justice, Gizo Uglava – First Deputy Director of the National Anti-Corruption Bureau of Ukraine, Davit Sakvarelidze – Deputy Prosecutor General, Eka Zguladze – Deputy Minister of Interior. In November 2015 Khatia Dekanoidze joined the team of reformers as the Head of National Police Forces of Ukraine.

Strategic vision and reforms

In June 2014 Boris Lozhkin started coordinating the collaboration of Presidential Administration staff and experts developing a medium-term plan for reforms and development of Ukraine – “The Strategy for Sustainable Development of Ukraine “Ukraine-2020”.[34] The final plan included 62 reform directions in economic, political and social spheres. Top priorities were 8 reforms and 2 programs. An important peculiarity of the document was the fact that it determined 25 key performance indicators of the country’s development.

On January 12, 2015 the President of Ukraine signed the decree “On the Strategy for Sustainable Development “Ukraine-2020”.[35] In July 2014 Boris Lozhkin started the process of optimization and increase in work effectiveness of the Presidential Administration staff. As the result the newly hired personnel constituted 40% of marginal staff quantity, managerial staff – 70%. Key performance indicators were developed for every position at the Administration.

After preliminary parliamentary elections that took place on October 26, 2014, Boris Lozhkin coordinated the work on creating the Parliament Coalition Agreement – a key document determining immediate action plan of the Ukrainian authorities. The agreement describes concrete steps to be implemented. 59% of them have execution terms set (in the sphere of economy – 66%).

In late 2014 with the support of the Presidential Administration and participation of private sector and IT business representatives a system of online procurements ProZorro was developed.[36] It allows to carry out subthreshold procurements of goods under 100 000 UAH in value and services under 1 000 000 UAH. In February 2015 the system started operating in test mode. Apart from Presidential Administration many government institutions implement the system (e.g. Ministry of Justice, Ministry of Agriculture, Enegroatom et c.). In April 2015 the National Reform Council obliged all of the state institutions to use ProZorro in subthreshold procurements.[37]

In 2014 – early 2015 Boris Lozhkin was supervising the process of legislative deprivation the Prosecution Service of general oversight function and creation of the National Anti-Corruption Bureau. At the same time, he coordinated establishing and functioning of the Judicial Reform Council. Initiatives of the Council were approved by Verkhovna Rada which led to adoption of the Law “On Fair Trial” and adoption of the amendments to Constitution concerning revision of the issue of immunity of judges in the first reading.

On June 3, 2015 President of Ukraine Petro Poroshenko appointed Boris Lozhkin Deputy Head of the National Reforms Council.

On August 29, 2016 Lozhkin was dismissed from his post and appointed the Secretary of the National Investment Council (pro bono) and a supernumerary advisor to the President of Ukraine.

The rotation in the President's team and appointing Lozhkin the Secretary of the National Investment Council signified serious intention of the President to focus the efforts on attracting foreign investment to Ukraine.

According to Poroshenko, "Borys Lozhkin is the best candidate for the role of the key manager and negotiator on the issue of attracting investment to Ukrainian economy".

National Investment Council

On August 29, 2016 Borys Lozhkin left the position of the Head of the Presidential Administration of Ukraine and was appointed to the position of the Secretary of the National Investment Council (as a volunteer).[38] At the same time, on August 29, 2016 he was appointed as a freelance adviser to the President of Ukraine.

In opinion of Petro Poroshenko, the task of Borys Lozhkin as a Secretary of the National Investment Council will be its transformation into the powerful instrument for formation of the national investment policy of the state. “Borys Lozhkin is the best candidate for the role of the key manager and communicator in the issue of attraction of investments into economy,” noted Poroshenko.

In accordance with the Presidential Decree, the main tasks of the Council are the following:

According to Lozhkin, the priority of work of the National Investment Council will be "creation of a stable ecosystem, attractive for foreign investors. One of the key directions of activity of the National Investment Council is the development and implementation of changes in the legislative sphere.[39]

In opinion of the Secretary of the National Investment Council, it is necessary to attract $120-200 billion of direct investments to Ukraine during the next 20 years, in order to provide its economic growth in the amount of 6-9% per year. Such growth rates will provide Ukraine with the GDP in the amount of $292 billion by 2036. Already in 2017 the National Investment Council is planning to attract investments into the economy of Ukraine in the amount of $3-5 billion.[40]

Lozhkin said the government should change its attitude to investors and change the environment with the help of new tools in particular. He suggested that Ukraine should follow the example of certain nations in North Africa, where presidents or prime ministers sign direct agreements with big investors on specific projects.[41]

According to Lozhkin, an American financier George Soros,[42] the Unilever Chief Executive Officer Paul Polman, the Management of Socar State Company from Azerbaijan[43] have already agreed to take part in the National Investment Council.

Books

The book “The Fourth Republic” was published by the Folio Publishers on March 18, 2016 in Ukrainian and in Russian. In two months the book was translated and published in English. In autumn 2016 the German translation of the book appeared. The text of the book “The Fourth Republic” was prepared by the authors from May to December 2015.

The name is a reference to the history of Ukraine. Lozhkin counts four stages of the Ukrainian state: Ukraine People’s Republic that existed in 1917-1919, Soviet Ukraine in 1919-1991, independent Ukraine before the EuroMaidan Revolution of 2014, and post-EuroMaidan Ukraine – the fourth republic.

Lozhkin stated that “working on the book gave me an opportunity to look beyond the horizon, it allowed me to clearly understand what has already been done and what still needs to be done to make our country into a successful European nation’’.[45]

The main reason for writing this book, according to Borys Lozhkin, was a wish to give an answer to the question in the books’ title: “Why Europe needs Ukraine, and Why Ukraine needs Europe?”. "The objective of the book is to show that it is possible to deal with Ukraine and it is worthwhile doing it. Our country will not turn into a failed state. Just the other way round — It can solve the problems of Europe, not create them. Ukraine needs Europe as an ally and as a source of values. Europe needs Ukraine to remind the essence of the European project itself, as well as to show that there is no end to the story" wrote Borys Lozhkin.

On September 17, 2016 Borys Lozhkin and Vladimir Fedorin received a special award for the book “The Fourth Republic” from the President of the Lviv Forum of Publishers, Oleksandra Koval. During the presentation of the book at the Forum of Publishers in Lviv the Folio General Manager Oleksandr Krasovytskyi said that within 5 months upon publication, the book has become a bestseller and the top-selling book among the social and political publications. 11 thousand copies of the book have been sold up to September 2016. On October 21, 2016 Lozhkin’s book was presented in Europe at the Frankfurt Book Fair.

Family

Lozhkin is married to Nadezhda Shalomova. Their daughter, Anastasia, was born in 1994.[6]

References

  1. ↑ "Decree of the President of Ukraine № 519/2014.".
  2. ↑ "Board of Directors". UMH Group. Archived from the original on June 22, 2012.
  3. 1 2 "RBC rating. 30 of the most influential media managers of the CIS". rbc.ru. 7 October 2013.
  4. 1 2 "Boris Lozhkin". WAN-IFRA.
  5. ↑ Poroshenko announces Lozhkin's resignation, appoints Rainin new head of presidential administration, UNIAN (29 August 2016)
  6. 1 2 "LOZHKIN Borys Yevhenovych". president.gov.ua. Retrieved 4 January 2015.
  7. 1 2 "Boris Lozhkin. Bio.".
  8. ↑ "Ukrainian magazine in the CIS top-10 biggest printed brands". Interfax Ukraine. 11 June 2013.
  9. ↑ "UMH Group has become the first Ukrainian media company with the shares listed on international stock exchanges.".
  10. ↑ "Umh Group, official site.".
  11. ↑ "Forbes to launch Ukraine edition.".
  12. ↑ "Ukraine's UMH Group to Publish Local Vogue Edition.". Bloomberg.
  13. ↑ "American publisher sells leading Ukrainian media group to Poroshenko.".
  14. ↑ "The largest Russian media companies".
  15. ↑ "Top 25 largest media companies in the CIS.".
  16. ↑ "Five Ukrainian media companies included in the ranking of the largest companies on the Post-Soviet space.".
  17. ↑ "Ukrainian Tycoon Buys Magazine That Investigated Him.". Bloomberg.
  18. ↑ "Top 10 M&A deals in Ukraine for the first half of 2013. Forbes.ua".
  19. ↑ "Kurchenko became the owner of UMH group.".
  20. ↑ All In The Family: The Sequel, Kyiv Post (7 October 2016)
  21. ↑ "Boris LOZHKIN about selling UMH group.".
  22. ↑ "Kyiv hosts the World Newspaper Congress 2012.".
  23. ↑ "WAN-IFRA Congress in Bangkok.".
  24. ↑ "Man of the Year-2003.".
  25. ↑ "TOP-100 influential Ukrainians according to "Korrespondent" magazine (2003).".
  26. ↑ "LOZHKIN Boris Evgenyevich. Atlas Media.".
  27. ↑ "Russian nationwide award "Russia's best media manager".".
  28. ↑ "Boris LOZHKIN received a state award from Valentina Matvienko".
  29. ↑ "Rich people rating of "Focus" magazine 2013.".
  30. ↑ "Verkhovna Rada official website".
  31. ↑ "Boris Lozhkin: "I am an anti-crisis manager"".
  32. ↑ "Boris Lozhkin. Lecture for students of Kyiv-Mohyla Business School".
  33. ↑ "Boris Lozhkin as a top-manager of President Poroshenko".
  34. ↑ "Ukraine 2020 strategy" (PDF).
  35. ↑ "On the Strategy for Sustainable Development "Ukraine-2020"".
  36. ↑ "ProZorro".
  37. ↑ "ProZorro e-procurement improves transparency, reduces corruption and saves taxpayers $14 million so far".
  38. ↑ "President announced appointment of Ihor Rainin to post of Head of Presidential Administration".
  39. ↑ "President invited American business to Ukraine: Now is the right time and place to invest".
  40. ↑ [=https://inventure.com.ua/en/news/ukraine/state-investment-support-office-to-be-formed-until-end-of-october "State investment support office to be formed until end of October"] Check |url= value (help).
  41. ↑ "Ukraine: Investment chief says govt should use more tools to attract investors".
  42. ↑ "Lozhkin invites Soros to join Ukraine Investment Council".
  43. ↑ "SOCAR invited to National Investment Council of Ukraine".
  44. ↑ "The Fourth Republic".
  45. ↑ "Boris Lozhkin On His New Book "The Fourth Republic"".
Political offices
Preceded by
Serhiy Pashynskyi		 Head of the Presidential Administration
10 June 2014 – 29 August 2016 		Succeeded by
Ihor Rainin
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