SEVERAL DOZEN armed men burst out of vans in the busy Dubininskaya district of Moscow and swept into the headquarters of Yukos, Russia’s biggest oil company.

The security guards at the company’s doors immediately identified the menacing swarm as agents from Russia’s notorious General Prosecutor’s Office.

Yukos lawyers rushed to meet the men. The raid, which took place 10 days ago, was the 150th on the company since June and staff were getting used to the procedure.

The arrival of government agents is usually followed by the production of a warrant and then a rummage through the office. But this raid was different. The agents brushed aside the security guards and ignored the breathless lawyers. They surged into Yukos’s lobby and took the lifts to the 12th floor, where they entered the company’s treasury department. Staff watched helplessly as the men ripped out all the computers with calculated efficiency and took them away.

Privately they all knew this was the end-game in the battle by President Vladimir Putin to destroy Yukos and its biggest investor, Mikhail Khodorkovsky.

Khodorkovsky, once Russia’s most powerful businessman, is in prison along with his co-investor Platon Lebedev awaiting trial on fraud and tax charges. In less than 18 months Yukos has been reduced from a company with a market value of $33 billion (£17 billion) to one that is almost worthless.

The Russian authorities have forced an auction of its biggest asset, Yuganskneftegas. This is set to take place on December 19 and the board seems powerless to stop it. The move, which ignored all legal procedures, effectively means Yukos will be stripped of its biggest cash generator.

On November 17 — the day of the raid in Moscow by the General Prosecutor’s Office — Steven Theede, Yukos’s American-born chief executive, was in London with his public-relations advisers when he took the call from Bruce Misamore, his chief finance officer.

Both were becoming increasingly concerned about their safety. The pressure rose when Misamore was issued with a subpoena ordering his presence in Moscow to give evidence in an undisclosed case.

Theede took the decision to call his team to Britain. When Misamsore, an American citizen, landed in London last Wednesday he said: “I am not going to sacrifice my life for Russia’s political purposes.”

On Wednesday night they had dinner at the Lanesborough hotel and over the next two days the board — which included Yuri Beilin, deputy chief executive, Peter Zolotarev, acting president — looked hard to see if Yukos could survive for the next five years without Yuganskneftegas.

But they knew it would be impossible and on Friday they issued a statement condemning the move by the Russian authorities. In recent months they had tried to open a dialogue with the government: the directors claim that more than 70 letters and 20 offers have been completely ignored.

The statement highlighted their anger. It read: “The actions taken against Yukos and members of the Yukos management team over the last few days by the General Prosecutor’s Office in Russia are more deliberate then the cycle of raids and demands placed on the company in the recent past. It is our belief that this extraordinary pressure from the GPO has specific aims: the removal of the management, the derailing of any settlement process with the Russian authorities and the total destruction of Yukos oil company.”

The statement did little for the confidence of big western investors. But United Financial Group’s Charles Granville, a seasoned observer of the Russian economy, said: “If (the Russian authorities) stick to the destruction of one company for a political reason that is clearly understood by everyone, the damage will be short-term.

“Everyone understands that the Kremlin perceived Khodorkovsky was trying to take over the state in contravention of a very clear understanding about how Russia was going to come out of its controversial privatisations of the 1990s. The lucky ones got to keep their winnings.”

To many in Russia, Khodorkovsky has been the architect of his own downfall. Along with many other oligarchs he had been gifted an opportunity that enriched him beyond his wildest dreams. In the mid-1990s, desperate to avoid defeat in the presidential election, the Kremlin did a deal with Russia’s leading businessmen. They were offered discounted shares in vast state industries, including Yukos, in return for loans used to prop up Boris Yeltsin’s campaign.

Khordorkovsky took the opportunity to buy control of Yukos, for a knockdown $309m. But as the value of the company multiplied, so did his ambitions. He started to interfere in politics and oppose Putin. In doing so he broke the rules.

Putin retaliated swiftly and harshly. Lebedev was arrested and charged with embezzlement over business dealings in the 1990s. A wave of investigations followed, looking into everything from Yukos’s tax payments to its alleged links to serious crime. These were marked by blatant shows of force, including night-time arrests and armed raids on Yukos’s charity projects.

Lebedev’s arrest and the investigation into his company were seen as a warning to Khodorkovsky. Then when he returned from America, he too was arrested and jailed. His trial, on tax evasion and fraud charges, started this year and is expected to continue into the new year. It was only a matter of time before other Yukos directors were drawn into the investigation.

One banker said: “Once you have retrospectively declared certain tax-efficiency schemes as illegal, there arises the question of who was vetting these legal schemes and might there be criminal (and not just civil) responsibility.”

Analysts believe Yuganskneftegas will now end up in the hands of the state-controlled Gazprom, in a deal that could involve international partners. They said Putin believes that Yukos is too important to be controlled by a private company. One in five cars use Yukos fuel and whole towns are powered and watered by the company. In addition, 40% of Yukos’s $925m monthly tax spending is distributed to the local regions, effectively funding schools, hospitals and other social projects.

Theede and his team have found themselves embroiled in a power game where they have no control over the pieces. And until they are given assurances, they will not return to Russia.

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