StartUps

"Google in Russia" Yandex sells local assets to expand in Europe.

By Kajal Sharma - 16 Dec 2024 08:04 PM

The majority of its Russian assets have been sold off by the parent company of Yandex, the biggest tech business in Russia and the equivalent of Google in that nation.The agreement gives the Dutch parent business the freedom to expand in Europe, freeing up its hundreds of highly qualified tech workers who left the nation. Its intentions include creating four AI-focused firms, which would be a major entry into the market at a time when competition is intensifying.A haircut from the Kremlin The Dutch parent company of Yandex, which is listed on the Nasdaq, has sold 72% of its Russian business to a group of investors, including Russian oil giant Lukoil, and members of the company's former management. In July, the final 28% of the deal will be completed. According to Russian government regulations on exits for Western corporations, the purchase, which was announced in February after 18 months of discussions, valued the company at $5.2 billion and required a 50% valuation decrease. Yandex was valued at $30 billion at its height.Founded during the dotcom boom of the 1990s, Yandex launched its main search engine in 1997. After that, it added online games, a music streaming service, an online map product, and a ride-hailing service to its list of offerings.

The company's plan to become a global internet giant was thwarted by the conflict. Foreign investors stayed away from it, and many of its employees fled the nation. In June 2023, the European Union imposed sanctions on Arkady Volozh, a cofounder of Yandex. In March of this year, the restrictions against him were removed. Currently, Volozh resides in Israel.Negotiations for the sale of Yandex's Russian assets required months of political backstabbing because the Kremlin considered the company to be strategically and economically significant. Putin's spokesperson, Dmitry Peskov, described the business as "one of the largest companies and one of the economy's national champions in high tech," according to Russian newswire Interfax. "The company's continued operations in the nation are important to us."

 

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