Yandex NV has received bids from billionaires Vladimir Potanin and Vagit Alekperov to buy a controlling stake in Russia’s dominant search engine that value the company’s Russian assets at about $7 billion, according to people familiar with the matter.
The board of Yandex NV, which also owns a popular ride-hailing app and ecommerce platform in Russia, is likely to discuss the bids next week when it meets in Dubai, the people said, asking not to be identified because the information is not public. It may not make a final decision at the meeting, they said.
The bids are seeking at least a 51% stake in Yandex’s Russian business, which they value at about 560 billion rubles to 600 billion rubles ($7 billion to $7.5 billion), according to the people. That takes into account a Kremlin-mandated 50% discount for foreign companies seeking to exit Russia, they said. Yandex is domiciled in the Netherlands, which the authorities consider an “unfriendly” country.
Spokespeople for Yandex, Potanin and Alekperov declined to comment. Some elements of the bids were reported previously by Russian outlets The Bell and Meduza.
Yandex has come under intense pressure both in Russia and abroad since President Vladimir Putin invaded Ukraine over a year ago. Once dubbed the “Google of Russia,” Yandex is now seeking to divest of its Russian business that generates most of its revenue and pursue a handful of international startups.
The asset is politically fraught given Yandex’s outsized role among Russian technology companies, and any winning bid is likely to include a consortium of owners, according to the people.
The Kremlin will need to sign off on the final group of buyers, so the board’s decision will be treated as a recommendation, the people said.
While Yandex last year got rid of its news aggregator that had been criticized for whitewashing Russian human rights crimes in Ukraine, it still controls over 60% of the local search market, exposing it to the Kremlin’s intensified internet censorship campaign since the start of the war.
Potanin’s proposal brings together a group of investors that includes former Chelsea football club owner Roman Abramovich and Russian state-owned VTB Bank, according to the people. Billionaire Alexey Mordashov may also join that bid, while steel billionaire Victor Rashnikov separately expressed the interest in a small stake, they said. Should Alekherov’s bid be selected, Potanin and some others may seek to participate in it, they said.
Abramovich’s press office said he was not negotiating the purchase of any shares. Spokespeople for VTB, Mordashov and Rashnikov declined to comment.
The interest in Yandex comes as Ukraine’s allies have sought to isolate Russian money. Potanin is sanctioned by the UK and US, while Abramovich is under EU and UK sanctions and Alekperov has been targeted by the UK.
Yandex has remained profitable despite the turmoil, reporting net income in the first quarter of 5.8 billion rubles. However, its shares have been frozen in New York since February 2022 and the Nasdaq is seeking to delist the company’s securities. The company’s market capitalization peaked in late 2021 before the war at $29 billion.
Yandex’s founder Arkady Volozh resigned as chief executive officer and recused himself from voting on any matters before the board when the European Union sanctioned him in June for the company’s role promoting Russian state media’s version of the war.
Volozh, who lives in Israel, has been seeking a deal to give up his Yandex stake in exchange for the Kremlin’s permission to keep intellectual property needed to develop some businesses abroad, Bloomberg reported previously, citing unidentified people familiar with his thinking.