The romantic glow of the harbour, fishing smacks and Old Town Montenegro mask a tax haven
Billionaire financier Nat Rothschild has planned a £1m 40th birthday bash in a tiny Adriatic hotspot
independent.co.uk | Jul 7, 2011
By Andy McSmith
This week, it was Monte Carlo. Next week, Montenegro. Nat Rothschild, who has one of the best financial brains in a family renowned for business acumen, will be 40 next Tuesday, and intends to make this a weekend to remember.
The financier is rumoured to be splashing out £1m on a birthday bash. That is small change for a man whose personal wealth is reckoned to be about a thousand times that amount. And the little state of Montenegro is understandably delighted to be chosen as the venue.
Montenegro is a staggeringly beautiful, mountain statelet onn the c oast of the Adriatic, only just more than half the size of Wales with a population of 660,000, slightly more than that of Glasgow. It has been an independent state only since 2006, when its people voted in a referendum to sever their union with Serbia. It is probably best known to the British public as the supposed setting of the film Casino Royale, though most of it was actually shot in the Czech Republic.
Uniquely for a sovereign state, Montenegro has no currency. All transactions are conducted in euros though it is not in the EU or the eurozone. This peculiarity has made it a magnet for Russian oligarchs, and for people who want to disguise the source of their wealth, such as Irish drug barons.
It is also open for those with legitimate business interests, including Nat Rothschild, who will be combining with pleasure by flying his guests in to see for themselves the attractions of the Bay of Kotor, one of Europe’s finest natural harbours, tucked between the mountains of Montenegro.
Mr Rothschild and his main business partner, the Russian oligarch Oleg Deripaska, have sunk a lot of money in to the fresh concrete that has been laid on the water’s edge in Kotor Bay. The British media will obviously focus its attention on who is or is not a guest at the Rothschild bash, because the only social event of the summer to match this one was last week’s wedding of the billionaire Prince Albert of Monaco to the former Olympic swimmer Charlene Wittstock.
Rothschild family archive gets a fittingly sumptuous new home
Eager to whet everyone’s curiosity, Porto Montenegro’s sales and marketing director, Colin Kingsmill, has told journalists that invitations have gone to “the ritziest, wealthiest, and most photogenic people on earth”.
It will be a glitzy occasion because Nat Rothschild has a lot of famous names in his contacts book. He was a contemporary of George Osborne at Oxford University, where they were both in the Bullingdon Club together, five years after David Cameron and Boris Johnson. It was Mr Rothschild who brought Mr Osborne and Peter Mandelson together on Oleg Deripaska’s yacht, in the summer of 2008, setting off an entertaining political furore when Mr Osborne revealed what Lord Mandelson had said in private about Gordon Brown.
When Rothschild threw a party in New York in 2008, the principal guest was Saif al-Gaddafi, son of the Libyan dictator, but no one expects him to join the party in Montenegro.
It can be assumed, though, that Nat Rothschild’s parents will be there. His father, Jacob, the fourth Baron Rothschild, is an investment banker and philanthropist, and his mother, Serena, is a racehorse owner who set a world record in 2004 by paying 4.6 million guineas (£4.7m) for the racehorse Magical Romance.
His social and business circles also include the oligarch Roman Abramovich, owner of Chelsea football club, the former head of BP, Tony Hayward, the American art dealer Larry Gagosian, Roland Rudd, co-founder of the Finsbury financial PR group, and many more.
While others of us may be nervously checking our bank statements and cutting down our overheads in these austere days, there are people in the world inhabited by Nat Rothschild with worries of a different order, including the shortage of parking spaces for exceptionally large yachts.
The marinas of southern France and Italy were designed a generation ago, when a yacht longer than about 100ft was pretty rare even in a millionaires’ playground. The Lady Ghislaine, the yacht off which the crooked tycoon Robert Maxwell fell to his death in 1991, was an exception, at 180ft, but Maxwell liked to have the biggest and best of everything, even if it meant paying for it with other people’s pensions.
These days, the Lady Ghislaine is nowhere near big enough to feature on the list of the top 100 privately owned yachts. A 240ft super-gin palace would get in at the bottom of that chart, while at No 1 there is Roman Abramovich’s Eclipse, which is three times the length of Maxwell’s.
As more of these superyachts came off the production lines, Europe’s billionaires were in danger of having to wander the Mediterranean with nowhere to dock until a group of entrepreneurs decided to create Porto Montenegro, in the Bay of Kotor, which, when it is complete in five or six years, will include a luxury hotel, a casino, 700 apartments, and 650 yacht berths.
After Nat Rothschild’s guests have quaffed his champagne and sung a chorus of “Happy Birthday” they will get a chance to look around. And that can only be good for business.
The VIP guests
* Nat Rothschild’s guest list has not been made public, but according to Montengran sources, it is so glitzy and ritzy that Tony Blair’s name was the dullest on the page. Mr Blair will not be joining the guests, though no one will be surprised to see Lord Mandelson there.
* Among the mega-rich believed to have been invited there is Oleg Deripaska, Russian owner of the world’s largest aluminium firm, Roman Abramovich, Peter Munk, Hungarian born head of the world’s largest gold mining corporation, the South African mining tycoon Mick Davis and Ivan Glasenberg, boss of Glencore, one of the world’s largest commodity companies.
* Another likely guest is Tony Hayward, who went into business with Nat Rothschild after losing his position at the head of BP over the Gulf of Mexico oil spill. The commodity trading company they founded together is valued at over £1 billion.
* But George Osborne, who has enjoyed Nat Rothschild’s hospitality before, may think it too big a political risk to be spotted enjoying the high life in Montenegro just now.
Montenegro for beginners
* In the time of Christ, Montenegro was an outpost of the Roman Empire. Later, it was ruled by the Serbs, then by the Turks. Its people are Orthodox Christian Slavs, closely related to the Serbs.
* The country’s national hero, the Montenegran Shakespeare, is Petar II Petrovic Njegos, who was a Christian Orthodox bishop and the secular ruler of the country until his early death in 1851.
* In 1878, Montenegro was recognised by the Turks as an independent state. After the 1914-18 war, it was included in Yugoslavia. The best-known 20th century Montenegran was Milovan Djilas, a communist who stood out alone not only against Stalin but against the corruption and repression under Yugoslav’s dictator, Tito. It was the last state to leave the Yugoslav Federation.
* After the break-up of Yugoslavia, Montenegro decided that it would be too expensive to create its own currency, and adopted the Deutschmark. In 2001, all the DMs in the country were gathered up, the large number of counterfeits were discarded, and the rest returned to Germany, who in return sent Montenegro an initial consignment of €30m, mostly in coins.