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What do you get when you take a Russia enthusiast with a purely American upbringing and education, and turn him loose in the financial world of the former Soviet Union for 15 years? The answer: an effective -- and valuable -- investment banker.
Bob Foresman, a new deputy director at Renaissance Capital, performs Bob Dylan songs on his guitar and harmonica, and spends a great deal of time with his wife and five children. But when he's at work, you'll often find him in the middle of some of the biggest privatization and energy deals in Russia.
It all started when Foresman left his small town in the Finger Lakes region of upstate New York and went to Bucknell University in 1986. He needed a language to study for his international relations major, and he settled on Russian.
"I knew that I wanted to do something different," Foresman said, echoing a common refrain heard among Westerners who fall into Russia's clutches.
When Foresman spent a semester studying at the Moscow Energy Institute, that "something different" took on a life of its own.
"I knew that I would spend the rest of my life focused on Russia," he said.
After graduation, he took some time off and then got a job with CBS News in Moscow, sending summaries of Soviet TV news to New York using his "very far from perfect fluency" in Russian.
He met his future wife in Kiev. Their first date was on the eve of the attempted coup on Aug. 19, 1991. He raced to Moscow and stood at the barricades, knowing he was seeing one of the most important events of his generation.
"It felt like you were in something historic," he said. "It paved the way for everything that is in Russia today."
For Foresman, it also paved the way for Russia's economic growth story, and he pulled himself away from the events of 15 years ago to work on a master's degree at what was then known as Harvard University's Soviet Union program.
"My classmates and I realized that instead of focusing on Kremlinology, we should be focusing on economic reform," he said. After the fall of the Soviet Union, economic reform meant privatization, which was his thesis topic.
He graduated and joined the World Bank's International Finance Corporation, advising the Ukrainian government and municipalities on privatizing small and medium enterprises. Two years later, he was working on land privatization with the IFC.
Foresman returned to the United States and spent a year and a half working for the IFC in Washington, his only financial experience in a Western office. He and his wife then returned to Ukraine, where he set up the corporate finance arm of ING Barings in Kiev.
Then the 1998 financial crisis swept across Russia, and banks were leaving left and right, opening up the field for young, ambitious bankers such as Foresman. In the summer of 1999, Foresman boarded a plane from Kiev to Moscow, and this time he would help ING Barings run its investment banking arm.
"I was in the right place at the right time," Foresman said. "Most of the top bankers had left town."
At ING, Foresman worked on the Mobile TeleSystems IPO, along with TNK's purchase of Onako oil company. Then, at the end of 2000, he was tapped to run the investment bank Dresdner Kleinwort Wasserstein and played a key role in large energy sector deals, including advising Gazprom on its acquisition of a majority stake in Sibneft and the Russian government on its valuation of Yukos' Yuganskneftegaz unit.
At Dresdner, he also worked closely with Matthias Warnig, a friend of President Vladimir Putin. Foresman described investment banking as a "relationship" business, and he and Warnig were able to use the relationships they had cultivated to snag some very big government-related deals.
"We didn't want to go after everything -- we wanted to go after some very interesting things," often state-related transactions, Foresman said.
In the spring, Renaissance Capital's Stephen Jennings approached Foresman to lure him to the bank, and he took Jennings up on the offer after finishing up his work on the Rosneft IPO.
"I joked with him that I had been a little bit offended that Renaissance had never approached me before," he said. Foresman says he sees the RenCap job as a permanent position and the "last bus stop to where I was going."
Foresman said Russian corporate executives in the last few years have shown a new level of sophistication in their business dealings, making investment banking here little different from the job in Western companies.
One difference in banking here is the state's powerful influence in certain industries, he said.
"Some of the dealings with state companies can be a little 'Russia-specific,'" he said.
Foresman also singled out corruption as a fact of life here. He said he had turned down business that didn't seem above board, and he has relied on his devout Christian faith and his belief in free markets to work his way through the Wild West days of early capitalism in Russia, as well as moral dilemmas that arise when the banker's loyalty clashes with clients interested in "skating a little too close to the edge."
"My values haven't changed," he said flatly.
Foresman says it's more surprising that Russia gave away its energy assets in the first place than that it's seeking tighter control over oil and gas today.
He bristles when U.S. papers criticize Russia for using energy for its foreign policy ends when, he said, American thirst for energy shapes Washington's policy as well.
And the world hasn't yet seen the last of Russia's interest in the oil and gas industries, Foresman said.
"Gazprom and Rosneft are not going to get less relevant -- they're going to get more relevant," he said.
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