RUSSIA - Feb. 20 - Crown Resources Buys Marc Rich.

Energy trading group Crown Resources' Managing Director Elliot Spitz says his firm is buying "100% of Mark Rich's trading business", called Mark Rich Investment (MRI), which is based in Switzerland. Under the deal, the holding firm of Mark Rich (a US Jewish billionaire who fled the US in 1983) will retain an interest in the newly enlarged commodity business. Crown Resources AG is a Swiss-based energy trading concern owned by Alfa Group. (The pardon of Rich from tax-evasion, fraud and racketeering charges last month by Pres. Bill Clinton as Clinton left office has sparked criminal and congressional inquires in the US. Rumours that Rich was looking to sell or merge his holdings were fuelled in 2000, when the billionaire trader was out of the office for two months with pneumonia. His aides said Rich began to think about planning his retirement and finding a suitable merger partner. An effort to merge with a Dutch firm, Traffigura, failed last year, and there was talk in recent weeks that Crown Resources was a likely candidate. The merger is expected to take place within two months. Swiss officials have been scrutinising MRI closely recently. They are examining whether the company should be exempt from strict new money-laundering regulations that cover third-party fiduciaries that handle other people's money. The law requires companies to ascertain the source of funds they handle and inform authorities of questionable activities.

Rich's company, along with other trading companies based in Zug, appealed for exemptions because the procedures are cumbersome and require delving into client finances. Rich's lawyer threatened that his client would pack up and leave for London if he did not get a waiver, for which the reclusive trader received a spate of bad publicity within Switzerland, where he has been accepted since he fled the US in 1983. The threat was later disavowed. Crown Resources, which moved to Zug from Gibraltar last year, has about 20 traders in the central Swiss canton. Spitz, in London where the deal is announced, indicates that Crown would be adding employees. Founded in the late 1980s, Alfa began in window-washing and expanded into a bank and a chain of suburban grocery stores before buying Russia's fifth-largest oil company. Crown, which was started in 1996, trades commodities worth about $4.5 bn, a figure that Alfa says would more than double after the merger). Spitz says the merged company would expand its trading in energy and metals. The new entity will capitalise on Rich's decades of experience and contacts in crude oil and metals and Crown's energy-trading expertise. Alfa says: "We want to depend less on the Russian market. This will allow us to cover the majority of emerging markets", including Africa and South America.