By Andrew Osborn
LONDON (Reuters) -In the twilight of the Soviet Union, Yevgeny Prigozhin was languishing in prison for theft. Now as the founder of Russia's most powerful mercenary group, he is vying for Vladimir Putin's favour by claiming a rare battlefield win in Ukraine.
His aim is to leverage the success that Wagner Group, his mercenary outfit, had this week in pushing Ukrainian forces out of the salt mining town of Soledar, a move that revives Russian plans to seize more of eastern Ukraine after multiple defeats.
Russia claimed victory on Friday, but Ukraine said on Saturday its troops were still battling to hold the town, though open source analysts said its forces had probably been pushed to its edge or out altogether.
Reuters could not immediately verify the situation.
Prigozhin, 61, who is sanctioned in the West and casts himself as a ruthless patriot, posed in combat gear with his men in a salt mine beneath Soledar and said they had captured it alone.
The Kremlin praised the "absolutely heroic selfless actions" of those fighting in Soledar, but the defence ministry on Friday initially attributed victory to its own airborne units and missile and artillery forces.
Prigozhin reacted with fury, saying Russian officials were not giving his forces due credit.
"They constantly try to steal victory ... and talk about the presence of other unknown people just to belittle Wagner's merits," he complained.
Hours later, the defence ministry responded with a statement "clarifying" the situation which acknowledged that Wagner fighters, whose actions it hailed as "courageous", had been the ones to storm the town.
Prigozhin then moved quickly to start awarding his men with specially struck medals to commemorate the "taking of Soledar."
Some commentators have said Prigozhin could one day be made defence minister, but it is not fully clear how much influence the businessman from St Petersburg has gained with Putin, who tends to balance factions with a strategy of divide and rule.
'A NEW HERO'
Sergei Markov, a former Kremlin adviser, has hailed the shaven-headed mercenary chief as "a new hero."
"Prigozhin has flaws too. But I won't tell you about them. Because Prigozhin and Wagner are now Russia's national treasure. They are becoming a symbol of victory," Markov wrote on his blog, saying they should be given more resources by the state.
Margarita Simonyan, editor-in-chief of the state-controlled RT channel and close to the Kremlin, thanked Prigozhin for Soledar.
Abbas Gallyamov, a former Kremlin speech writer, suggested on his blog that Prigozhin was manoeuvring in case Putin removed Defence Minister Sergei Shoigu, 67, his long-standing ally.
Prigozhin has played down the idea he is seeking official elevation in the past, while not emphatically ruling it out. His press service, and the Kremlin, did not immediately reply to requests for fresh comment.
Putin has said Wagner does not represent the state, is not breaking Russian law, and has the right to work and promote its business interests anywhere in the world.
One of the military bloggers who help shape Russians' view of the conflict likened Prigozhin to a Roman centurion licensed to operate above and outside the law to achieve Putin's goals.
But Igor Girkin, a Russian nationalist and former Federal Security Service officer who helped launch the original Donbas war in 2014 and is under U.S. sanctions, has said Prigozhin is careless with the lives of his men.
He mocked Prigozhin for awarding medals for the capture of what he said was "a big village" and said the appointment this week of Russia's top general, an ally of the defence minister, to oversee the Ukraine campaign was a threat to Prigozhin.
The new commander would look to eliminate pushback to the defence minister from critics like Prigozhin and only direct intervention from Putin could spare him, he predicted.
If Putin did not intervene, "Prigozhin will be thrown out of the political arena as well as the military one," he forecast.
Prigozhin, nicknamed "Putin's Chef" by Western media because he once ran a floating restaurant in St Petersburg where Putin ate, has plenty to gain or lose.
He has his own future to consider at a time of tumult as well as the commercial interests of Wagner, which Russian officials say has military and mining contracts in Africa and is active in Syria. He also has a vast catering company serving state entities, as well as troll farms and media outlets.
"In essence, he is a private businessman who is highly dependent on how his relations with the authorities are structured. This is a very vulnerable position," said Tatiana Stanovaya, founder of the R.Politik analysis firm.
Russia has allowed Prigozhin to recruit tens of thousands of convicts from its prisons for Wagner, which U.S. officials say is a 50,000-strong force, and let him equip them with tanks, aircraft and missile defence systems.
It has also stood by while he flung sometimes profane criticism at the top brass, although some Western military analysts suggested the appointment of the most senior general to lead the war in Ukraine was designed to balance his influence.
Before Russia's invasion, something Moscow calls "a special military operation", Prigozhin had denied his Wagner connection. In September, he said he had founded the mercenary group in 2014.
Despite its sometimes publicly strained ties with the Russian defence ministry, some Western military analysts suspect Wagner is closely affiliated with it.
Some Kremlin critics have said there is a risk Wagner could one day throw off Kremlin control.
One source close to the Russian authorities, who declined to be named because they were not authorised to speak to the media, said the Kremlin viewed Prigozhin as a useful operator but maintained unspecified safeguards over leaders of armed groups.
"There is a ceiling (of growth) and mechanisms in place," said the source, who declined to provide more details.
(Reporting by Andrew Osborn; editing by Philippa Fletcher)