Does Russia form the basis of Jim Mellon's wealth, and did Jim Mellon make most of his money in Russia? A number of publications have claimed this is the case, however on further analysis, it becomes apparent that the bulk of Mellon's wealth was not made in Russia.
Pre-Russia
Well before entering Russia, Mellon was already a successful fund manager. After leaving GT (Griffin Thornton), Mellon made a string of very successful investments in East Asia. These investments included the San Miguel Brewery, in the Philippines.
On exiting, Mellon was already a multi-millionaire. Some time later, Mellon set up Regent Pacific, another fund management operation.
Regent Pacific
Regent Pacific was formed with a primary focus on East Asia. There were a number of strategies employed by the firm, however East Asia remained it's number one priority. John Tempelton was an early investor in the fund.
So where does Russia come into all of this?
In 1994, Mellon was on a trip to Russia to explore investment opportunities. He figured that there was a mass privatization of state owned assets. Mellon decided it was a good time to get his fund involved in Russia, and to invest in the country.
After the first series of successful investments, Regent believed the country had much more to offer, as a result, they increased their investments in Russia.
What happened in 1998?
The Russian financial crisis. Russia defaulted on its debts. As a result of the Russian financial crisis, Regent Pacific lost a lot of money, due to its exposure to Russia.
So how did Mellon allegedly make most of his money in Russia?
He didn't. The claim that Mellon made most of his money in Russia is a myth. The following diagram broadly illustrates the timeline of Mellon's career. In it, we illustrate the three key sectors which have formed the basis of Mellon's wealth. Those are real estate, mining and biotech.
Are there any public examples?
Mellon alongside 3 colleagues founded Biohaven, a biopharmaceutical company. It is now listed on the NYSE (New York Stock Exchange). Mellon also built a very large real estate portfolio in Germany.
So is the claim that Mellon made most of his money in Russia a myth?
Yes, Mellon was involved in Russia in the 90's, after which he has had no direct involvement in Russia. Most of Mellon's wealth is derived from successful investments in real estate, mining and biotech.