Russian billionaire Mikhail Prokhorov said on Monday he would run for president against Prime Minister Vladimir Putin next March, weeks after falling out with the Kremlin over his abortive leadership of a small pro-business party.

Putin is expected to win the March 4 election despite growing signs of discontent with his rule after a parliamentary election that the opposition said was rigged and brought tens of thousands of people out on to the streets in protest.

Prokhorov, a 46-year-old metals tycoon who owns the U.S. New Jersey Nets basketball team, accused the Kremlin of engineering a revolt to force him out of the Right Cause party in September and political analysts say he has no chance of victory.

But he has been widely seen as a tool of the authorities and allowing him to run for president could help Putin appease liberal critics who fault him for not allowing the emergence of a stronger party or leader to represent the middle class.

I have made a decision. I will run in the presidential election, Prokhorov told a news conference. The Kremlin kicked me and my supporters out of the Right Cause party ... but it's not my principle to stop halfway.

Prokhorov, who is chairman of Polyus Gold, Russia's largest gold producer, said his supporters had begun preparations to gather the more than 2 million signatures needed to launch a bid for the presidency.

Dmitry Peskov, Putin's spokesman, said the prime minister was aware of Prokhorov's plans and rejected the possibility of him becoming a serious rival.

DEFENDER OF MIDDLE CLASS

Forbes magazine has estimated Prokhorov's fortune at $18 billion and ranks him as Russia's third richest person.

Prokhorov described himself at the news conference as a defender of middle-class interests and promised to set up a party of his own regardless of the outcome of the presidential election.

But his independence of Russia's rulers remains in question because his rise to the head of Right Cause earlier this year was widely seen as a Kremlin attempt to create a sanctioned liberal party.

Prokhorov was forced out after announcing his desire to become prime minister, apparently going off script.

The biggest liberal alliance, one of whose leaders was former First Deputy Prime Minister Boris Nemtsov, was barred from running in the parliamentary election on December 4 in which Putin's United Russia won only a slim majority.

Nemtsov said he believed Prokhorov's candidacy was another Kremlin project to cater for the votes of the middle class who showed their discontent by taking to the streets on Saturday to complain that the election was slanted to favour United Russia.

This is a 100 percent Putin-inspired project, he told Reuters. But the Internet audience who walked out ... on Saturday, don't trust what they see on (state) television ... and so the project is doomed.

Independent political analyst Dmitry Oreshkin also said Prokhorov was no threat to Putin.

His appearance will freshen up the electoral campaign, create an illusion of fairness and legitimacy, Oreshkin said. But his main goal is to take some protest votes from the leader of the Communist Party Gennady Zyuganov, and he may get some, albeit not many.

Some liberal Russians voted for the Communist Party in the parliamentary election as a way of showing their disappointment with United Russia, described by many of its critics as the party of swindlers and thieves.

Other presidential candidates are expected to include communist Gennady Zyuganov, nationalist Vladimir Zhirinovsky, liberal Grigory Yavlinksy and Sergei Mironov, lead of the left-leaning Just Russia party.

(Writing by Alexei Anishchuk, additional reporting by Gleb Bryanski, editing by Timothy Heritage)