[ad_1]
The parent firm of Russia’s most prominent technology company, Yandex, said it has agreed to sell all its assets in the country for about $5 billion, which would be one of the largest corporate exits from Russia since its invasion of Ukraine.
The invasion had roiled Yandex — often referred to as “Russia’s Google” — and turned its attempts to navigate between the Kremlin’s authoritarian policies and a Western blockade of the Russian economy into the most dramatic example of the war’s impact on the country’s once-vaunted tech sector.
The deal announced on Monday came after 18 months of negotiations. It is an attempt by some of the company’s executives to shield Yandex’s new generation of businesses from the war’s fallout and to obtain relief from European sanctions.
Under its terms, Yandex’s Dutch-registered parent company, known as YNV, would sell all its businesses based in Russia, which represented 95 percent of its revenues between January and September of last year, to a group of Yandex managers and Russia-connected investors. The businesses for sale account for most of the company’s assets and employ the bulk of its 26,000 employees.
The assets include a popular internet browser and Russia’s main food delivery and taxi-hailing apps. After the sale, YNV would keep control of four smaller subsidiaries focused on artificial intelligence, which are already operating outside Russia. The new entity would employ about 1,300 people, including about 1,000 technology specialists, most of them Russian.
YNV’s chairman said in a statement on Monday that the sale would enable the A.I. businesses — which develop technologies like self-driving cars, cloud computing and machine learning — to grow under new ownership unconnected to Russia.
The buyers would pay in shares and cash — in Chinese yuan transferred outside of Russia — in a deal worth about $5.2 billion in today’s prices. That value represents roughly half of Yandex’s current market capitalization, a reflection of steep discounts that the Kremlin has imposed to punish companies that have tried to leave the country and are based in countries that the Kremlin considers unfriendly.
Companies based in the West have faced extreme hurdles in their attempts to leave Russia in the past two years. Russian authorities must sign off on buyers, price and terms, often forcing the exiting companies to sell at fire-sale prices.
The deal is subject to government approvals in Russia and must be acceptable to European regulators. Yandex said it expected the first stage of the sale to take place by the middle of the year.
Aleksei L. Kudrin, Russia’s chief government auditor and a longtime confidant of President Vladimir V. Putin, became an official adviser to Yandex’s Russian businesses in December 2022, a step widely seen as an attempt to win government support for the restructuring plan.
“For us, it is important that the company continues to operate inside our country,” Dmitri S. Peskov, the Kremlin’s spokesman, told reporters on Monday, referring to Yandex. If the deal is approved, “the Russian management of the company would remain the largest owner — that’s also important,” he said, adding that he cannot comment on the details of corporate negotiations.
Various Western-based companies, including Danish brewer Carlsberg and German power company Uniper, had announced sales of their Russian assets to local buyers, only to have the deals scuppered by the Kremlin.
The buyers of Russia’s most recognizable tech company do not include any prominent members of the country’s business elite, a reflection of YNV’s difficult task of finding investors with large enough pockets but without direct connections to the Russian government or sanctioned officials and oligarchs.
The group of buyers is led by some of Yandex’s Russian management team, and includes tech entrepreneur Alexander Chachava and an investment fund owned by Russia’s largest private oil company, Lukoil. YNV said none of the buyers are under Western sanctions, and they are not allowed to sell or transfer their stakes for a year after completing the deal. These conditions are aimed at addressing Western concerns that the deal could ultimately benefit Kremlin insiders.
After the invasion of Ukraine, at least three senior Yandex executives publicly condemned the war, becoming some of the most prominent Russian businessmen to break with the government line. Thousands of the company’s employees have left the country following the invasion, often to continue working remotely.
The antiwar declarations, however, have not shielded the company from Western backlash. The European Union has sanctioned Yandex’s founder, Arkady Volosh, and its deputy chief executive at the time, Tigran Khudaverdyan, for enabling Russia’s war effort, forcing them to step down from the company to maintain its access to Western financial services.
The European Union said Yandex’s news aggregation service at the time had blocked antiwar content, in effect enabling Russia’s propaganda. The company said it had no choice but to comply with Russia’s strict censorship laws, and has since sold the news aggregation service.
Mr. Volozh has called the sanctions against him “misguided.”
“Russia’s invasion of Ukraine is barbaric, and I am categorically against it,” Mr. Volozh, who lives in Israel, said in a statement in August. “I have to take my share of responsibility for the country’s actions,” he said, without offering additional details.
After being sanctioned, Mr. Volosh cut formal ties to YNV, but still owns about 8 percent of the company’s shares.
Paul Sonne contributed reporting to this article.
Source link
