Peter Mandelson parties with his super-rich chums again … and the security guards DEFINITELY don’t want you to see him

Source:, July 10 2011
By: Abul Taher



It was a lavish party packed with oligarchs and mining magnates. Just the sort of occasion where you might expect to see Peter Mandelson.But it seems someone was determined the world would not be allowed to see the Labour peer enjoying the lavish 40th birthday celebrations of his close friend billionaire Nat Rothschild.Burly security guards used strong-arm tactics in a bid to prevent the former Business Secretary from being photographed as he joined other guests in Montenegro for the £1million event.

Celebrating: Nat Rothschild, left, Peter Munk and Milo Djukanovic, right, enjoy the celebrations - but the Mail on Sunday's attempts to take pictures of Lord Mandelson were stopped by bouncers

Celebrating: Nat Rothschild, left, Peter Munk and Milo Djukanovic, right, enjoy the celebrations – but the Mail on Sunday’s attempts to take pictures of Lord Mandelson were

stopped by bouncers

They snatched a mobile phone and deleted photos from the device and a camera memory card before ordering a Mail on Sunday reporter to ‘Take a walk’.

The three-day celebration for 300 guests in Porto Montenegro – ‘the St Tropez of the Adriatic’ – started on Thursday evening with a reception at a beachside restaurant, followed by the main event on Friday night, an open-air disco beside an infinity pool.

Lord Mandelson arrived at the party wearing a dark-blue open-necked shirt and white chinos and was immediately surrounded by security staff who ushered him towards a launch.

When the Mail on Sunday reporter tried to take a picture on his mobile, the bouncers swooped.

One 6ft guard with a strong East European accent said ‘Let me see your phone’, as he snatched it away.

He then deleted the only picture of Lord Mandelson the device contained. Handing the phone back, he told the reporter: ‘No pictures here please.’ Another heavily built security guard said: ‘Take a walk now. Just take a walk. I don’t want to see you here ever again.’

An MoS photographer was also forced to delete all the photographs he stored on a camera memory card and told to leave immediately.

Elusive: Mandelson in London, but not at the lavish party for his friend, Nat Rothschild”
Birthday boy: Nat Rothschild has pulled out all the stops for his big day”

Guests at the party – who were entertained until 4am by DJs flown in from the UK – drank Bellini champagne cocktails and enjoyed dinner at tables set out on each side of the vast pool.

The menu included a ham, figs and olive starter and barbecued Adriatic fish, followed by fruit panna cotta with wild berries – all teamed with £100 bottles of Bordeaux wine.

Lord Mandelson is believed to have stayed at the Aman Hotel on a private island at nearby Sveti Stefan. The hotel charges up to £2,600 per suite.

Russian oligarch Oleg Deripaska arrived at the festivities on his £70 million yacht the Queen K, in an echo of the most infamous meeting between Mandelson and investment banker Nat Rothschild.

Three years ago, Lord Mandelson attended a party hosted by Mr Rothschild on Mr Deripaska’s yacht on the Greek island of Corfu. During the trip he allegedly ‘dripped pure poison’ about then Prime Minister Gordon Brown.

The source of the leak was believed to have been the then shadow chancellor George Osborne. The Chancellor was not invited to this weekend’s celebrations, according to sources close to the Rothschilds.

Hideaway: Sveti Stefan in Montenegro hosted part of the lavish three-day party, and in which Peter Mandelson stayedHideaway: Sveti Stefan in Montenegro hosted part of the lavish three-day party, and in which Peter Mandelson stayed

Other dignitaries who were invited included Peter Munk, 84, the Canadian billionaire who owns the largest gold mining company in the world; Tony Hayward, the former disgraced boss of BP who quit after the oil spill crisis in the Gulf of Mexico last year and is now one of Mr Rothschild’s business partners; and Milo Djukanovic, former prime minister of Montenegro.

Among other guests were historian Niall Ferguson and his pregnant wife Ayan Hirsi Ali, Russian model Sasha Volkova, Jimmy Choo shoe boss Tamara Mellon and British fashion author and socialite Plum Sykes.

The Sawiri family, Egyptian tycoons, were also there, apparently to check out the competition: they are building a £1billion marina and hotel development on the other side of the Bay of Kotor.

One royal guest was said to be King Kgosi Leruo Molotlegi. The leader of the Royal Bafokeng Nation – a semi-autonomous tribal region in South Africa which is rich in platinum – is a contact from Mr Rothschild’s mineral business interests.

After dinner, a beaming Lord Mandelson watched as Mr Munk delivered a speech in honour of Mr Rothschild, lavishly praising his business achievements.

Mr Munk’s massive yacht, the Golden Eagle, was one of two dozen moored in the marina. The largest, the Queen K, belongs to Mr Deripaska, a Russian aluminium oligarch.

The festivites included a party on the jetty beside Oleg Deripaska's yacht, the Queen KThe festivites included a party on the jetty beside Oleg Deripaska’s yacht, the Queen K

The billionaire banker Nat Rothschild pulled out all the stops for the lavish party. About five tons of food and drink as well as top musicians and entertainers have been brought into Montenegro for the extravagant three-day bash.

The investment bank chief flew high-profile revellers by private jet to a £520m marina he part-owns.

Long-legged young British women in short skirts and high heels emerged from sleek black Audis and Mercedes, bringing a touch of Chelsea to the Balkan resort.

One Porto Montenegro resident told the Sunday Telegraph: ‘This place has become like a bar on Sloane Square overnight.

‘A month or two ago we’d nicknamed it Porto Moscow, there were so many Russians around. But it’s a completely different atmosphere with all the British here.’

A fleet of articulated lorries travelled from the UK to the south-eastern European country carrying equipment and furniture including 100 palm trees which will be used to create a calm and relaxed atmosphere.

It is thought nearly £100,000 has been spent on some of the wines from the Rothschilds’ top Bordeaux estates as well as other alcoholic beverages. Chelsea football club owner Roman Abramovich is one of the guest attending the glitzy do. Wealthy: Former BP boss Tony Hayward, left, and Chelsea owner Roman Abramovich attended then party

Rothschild and other billionaire investors have backed plans to establish an Adriatic St Tropez at Porto Montenegro, which is why he was probably so keen to host his party there.

The three-day no-expenses spared bash was an unofficial launch party for the development, built on the remains of a dilapidated Communist-era naval base.

The waterfront has had to be cleared of the rusting hulks of old warships. But they have salvaged one submarine, with plans to turn it into an exotic cocktail bar.

Plans are also in place for an international school and golf course to cater for super-rich residents, while a nearby commercial shipyard is to be turned into a maintenance yard for superyachts.

For hours before the start of the party the whole venue had been a building site swarmed over by mostly British construction workers.

Dress code for last night was ‘disco chic’ and the celebration was dubbed ‘Nat’s disco soiree’ which took place around 65-metre infinity pool.

The birthday celebrations continued the next day with a ‘hangover lunch’ in the sunshine around the infinity pool.

Many of the high-profile guests are so discreet in their private lives security has been given cards to identify who’s who.

The party is set to continue throughout the weekend.

Springtime in Brussels and a familiar figure is wreathed in smiles as he announces his latest diplomatic masterstroke.

After three years of talks Peter Mandelson, the EU Trade Commissoner, has secured a bilateral agreement with the tiny Adriatic nation of Montenegro.

‘Today’s signature is an important milestone,’ he cooed. Montenegro’s progress towards becoming a reliable world trading partner had been ‘remarkable’.

The Mafia paradise that holds secret to tycoons’ alliance

By Richard Pendlebury and Neil Barnett

'Future Monaco': The port of Tivat in Montenegro is going to be transformed into the 'Monaco of the Adriatic'

‘Future Monaco’: The port of Tivat in Montenegro is going to be transformed into the ‘Monaco of the Adriatic’ and has a tight circle of wealthy backers

Even so, one imagines that Montenegrin trade prospects rarely dominate small talk at the world’s most glamorous restaurants. But they might well have done so at the Moscow dinner table we know Mandelson to have shared with his good friend, Oleg Deripaska, only a few weeks before the Brussels’ announcement in April.

Or, indeed, on any of the other occasions when the commissioner has broken bread with the Russian and their mutual friend  –  and Deripaska’s business partner and adviser  –  the British financier, Nat Rothschild.

Why? Because Deripaska, Russia’s wealthiest man, is also the single largest private employer of Montenegro’s 680,000 population, responsible for half of the nation’s legitimate economic output.

Rothschild  –  who this week caused a political firestorm by accusing Geroge Osborne, the Tory Shadow Chancellor, of soliciting a £50,000 donation from Deripaska  –  also has a stake in one of the Russian’s projects in Montenegro, as well as other heavy business links with him.

Indeed, this unholy alliance may very well be the key to understanding Rothschild’s astonishing betrayal of his old university chum, Mr Osborne.

BUT why has a tiny state like Montenegro assumed such importance to Deripaska and his business partners? It is no secret that the country has a significant and well-established black economy. As one Balkan business analyst said: ‘It is the one country in the region that isn’t just bedevilled by corruption, it’s a kleptocracy.’

Montenegro, which broke from a federal union with Serbia two years ago, has been governed by prime minister Milo Djukanovic since 1991.

Djukanovic is an interesting character. He had long been ‘ tolerated’ by the West for opposing the regime of late Serbian tryrant Slobodan Milosevic. But allegations of links to hugely profitable, mafia-run tobacco smuggling between his country and the EU have seen him repeatedly investigated by Italian prosecutors.

If Djukanovic is the political leviathan of this tiny state, then his friend Deripaska, similarly tainted by alleged mafia-links, is his economic equivalent.

It is said that Djukanovic personally handled the controversial sale of Montenegro’s most important state-owned industrial asset  –  the KAP aluminium firm  –  to a subsdidiary of Rusal, Deripaska’s aluminium concern.

Rusal is the world’s largest producer of the metal and benefited greatly from two EU aluminium import tariff cuts which were made while friend Mandelson was trade commissioner.

Some say that KAP was considerably underpriced. There are whispers of kickbacks.
Others resent the way in which Russia has taken such a huge stake in their country.

Since 2001 Russia has commanded first place in the countries investing in Montenegro.

Investor: Lord Rothschild, father of Nat, is also on board for the Porto Montenegro marina development near the town of Tivat Investor: Lord Rothschild, father of Nat, is also on board for the Porto Montenegro marina development near the town of Tivat

Tourism from Russia has rocketed, too. But the main source of investment in recent times has been in real estate, mostly along the gorgeous Adriatic coast.

There are those cynics who say that much of the Russian property investment is a money laundering operation by criminal elements from the Russian Federation.

Of course, there is no suggestion that this might explain Mr Deripaska’s interests in the region.

But there is undoubtedly one project for which he has particularly-high hopes  –  or at least had before the credit crunch shrank his  £14billion fortune. That is the extraordinary Porto Montenegro marina development near the town of Tivat.

It is often said of Monaco that it’s ‘a sunny place for shady people’. Given the identities of some of its recent investors, much the same could be said of the beautiful Montenegran coast.

But at Tivat they really are going to build what has been billed ‘the Monaco of the Adriatic’. A Four Seasons hotel is part of the multi-billion-pound plan, as well as hundreds of luxury appartments and berthing for 800 boats  –  150 of them superyachts.

Once again prime minister Djukanovic was personally involved in the negotiations, which saw an abandoned ex-Yugoslav naval base and dockyard sold to foreign investors in early 2006. Once again there were allegations of underpricing.

The yard was bought by a firm called TriGranit, Hungary’s biggest property developer. It is co-owned by a Hungarian-born Canadian billionaire named Peter Munk and Nat Rothschild.

Munk, 80, is owner of Barrick Gold, the world’s largest gold producing company. He was advised to invest in Montenegro by the Rothschild family, with whom he has long enjoyed business ties.

Then he made a call to Deripaska. ‘Oleg made the first phone call to the prime minister (Djukanovic) and opened the door for me,’ Mr Munk explained.

But Munk and Rothschild were not alone in the project. Also on board are Nat’s father Lord Rothschild and two other business big names. One, Bernard Arnault, the chairman of luxury goods conglomerate LVMH, adds lustre.

The other  –  Deripaska himself  –  adds a blizzard of cash and a warship-sized yacht, the 283ft Queen K, which has been the subject of recent notoriety as a honeypot for Britain’s political elite.

Work on the Montenegrin project is already well under way. Giant palm trees have been brought in from Spain, the pier fenders are lined with African teak and fountains made from Venezuelan stone tinkle prettily.

Porto Montenegro should open for business next year. PM Djukanovic hopes that he can persuade the EU to accept Montenegro as a member by 2012, which should help the Tivat development considerably.

Certainly, its tight circle of wealthy backers have much at stake. Munk sits on the international advisory board of Rusal, Deripska’s metals giant. Nat Rothschild (whose JNR firm advises Deripaska) sits on the equivalent board at Barrick Gold.

In return, Munk has reportedly invested heavily in Nat Rothschild’s New Yorkbased Atticus hedge fund.

How very cosy. But this nexus of tens of millions of pounds of wealth has been much reduced in recent weeks and is still precarious, thanks to the world financial downturn. Fear stalks the oligarch mansions.

Even Deripaska is reportedly struggling to meet debt repayments on a part of his metals empire and will have to liquidate assets.

In this fraught enviroment, George Osborne  –  the Shadow Chancellor  –  made a stupid misjudgment.

He chose to score a cheap political point by leaking embarrassing remarks about Peter Mandelson  –  the same Commisioner Mandelson who had so enthusiastically praised Montenegrin economic progress and had shown a liking for tariff cuts.

And by so doing, Osborne also unwittingly shone an unwelcome light on Mr Rothschild’s most important business partner, Mr Deripaska.

So Rothschild went on the attack. When business is this stormy, you have to choose your place of shelter. And Rothschild’s was the Porto Montenegro connection.

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