Gibraltar prepares for first auction of a Russian oligarch’s detained superyacht

A £65m ($75m) superyacht of a Russian oligarch hit by sanctions will be auctioned off by the Gibraltar government on Tuesday, becoming the first of the luxury vessels to be sold off since restrictions were imposed on hundreds of rich Russians after Vladimir Putin’s invasion of Ukraine.

However, the 72.5-metre Axioma is not being sold for the benefit of the Ukrainian people but for a US investment bank, JP Morgan, which claims the yacht’s billionaire owner, Dmitry Pumpyansky, owes it more than $20m (£17m).

The vessel, which features six luxurious guest cabins, a swimming pool, a 3D cinema room, gym, jacuzzi and a fully equipped spa, was detained after docking in Gibraltar in March.

Pumpyansky, the owner and chairman of the steel pipe manufacturer OAO TMK, a supplier to the Russian state-owned energy company Gazprom, was subjected to sanctions by the UK, EU and the US after the invasion of Ukraine. The UK said the billionaire, who it said had built up an estimated £1.84bn ($2.17bn) fortune, was one of the oligarchs “closest to Putin”.

While dozens of superyachts suspected of being owned by oligarchs under sanction have been detained or confiscated across the world, Axioma is the only one that has been put up for sale.

However, the proceeds will not be paid to the people of Ukraine. The UK and other governments have suggested the sanctioned oligarch’s assets could be seized and used to assist Ukraine refugees.

However, in this case, the yacht was detained by the Gibraltar government after a legal claim from JP Morgan, which said Pumpyansky’s holding company Pyrene Investments owed it more than $20m.

JP Morgan said the fact the billionaire had been subjected to sanctions meant the terms of the loan had been breached because it legally could not accept loan repayments from Pyrene, and asked the Gibraltar courts to detain and sell the yacht.

A spokesperson for Gibraltar Courts Service said: “The Axioma was arrested following the filing of an admiralty claim in the supreme court. Given that the sale is by auction, pursuant to an order of the court, the Admiralty marshal cannot say how much it is expected to sell for or how many people have expressed interest.”

A JP Morgan spokesperson said: “We will politely decline comment on the Axioma matter.” The bank did not respond to questions about whether it would donate any of the money from the sale to Ukrainian refugees but the spokesperson said: “JP Morgan expanded a philanthropic commitment of $5m to $10m to help support worsening refugee crisis in Ukraine.”

Pumpyansky could not be contacted for comment. Questions sent to TMK Group, of which he is chairman, went unanswered.

Nigel Hollyer, the broker to the Admiralty marshal of the supreme court of Gibraltar, is leading the auction. He said there had been an “unexpected late surge by prospective buyers” and more than 30 had flown to Gibraltar to inspect the yacht in person.

“They are people from across the world,” Hollyer told the Guardian. “They are people who own or have owned boats of similar size, and have been attracted to this boat because of the judicial sale process – they are convinced they’re going to get a bargain.”

He said more potential buyers are booked in to see the boat across the weekend, and on Monday morning before the sealed bids auction closes at 1pm Gibraltar time on Tuesday.

The yacht, which was designed by the famed superyacht designer Alberto Pinto, was built by Dunya Yachts in Turkey in 2013. The boat, which was originally named Red Square before being renamed Axioma, was available for other millionaires to charter for $558,500 a week.

“With its luxurious interiors, vast array of onboard facilities and a highly trained and professional crew, a luxury yacht vacation onboard motor yacht Axioma promises to be nothing short of spectacular,” the charter listing states.