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Yandex owner sells 'Russia's Google' for $5.21 bln, joining other big businesses leaving Moscow

Yandex owner sells 'Russia's Google' for $5.21 bln, joining other big businesses leaving Moscow Yandex (Getty Images)

Yandex NV agreed to sell its business in Russia, which contains the country's most popular search engine, for about $5.2 billion (475 billion roubles). This is the biggest deal of its kind since the beginning Russian full-scale invasion of Ukraine almost two years ago, according to Reuters and Bloomberg.

The deal means that Russia's biggest technology company will now be completely owned by Russian investors, including a fund linked to the oil giant Lukoil. Yandex's management will have the largest share in the Russian business, while Lukoil PJSC's fund will hold 10%.

Now over 95% of Yandex's revenue-generating businesses will stay in Russia under Russian control. The Kremlin was also engaged in negotiations with Yandex.

The deal values Yandex at $10.2 billion, a significant drop from its late 2021 market value of nearly $30 billion. The sale price includes a mandatory discount of at least 50% of the fair value, as required by the Russian government for foreign asset sales. The separation took more than a year to work out.

Yandex NV, based in the Netherlands since 2007, can now focus on projects outside Russia after selling off the units that made most of its money. It plans to keep a portfolio of early-stage tech businesses, including an AI cloud platform and self-driving technologies, a data center in Finland, and key intellectual property assets.

Yandex facing troubles after full-scale war started

Yandex, originally considered a potential global business, provided various online services in Russia, such as search, advertising, and ride-hailing. Yandex faced challenges both in Russia and internationally since Russian President Vladimir Putin sent troops to Ukraine. Its co-founder, Arkady Volozh, was sanctioned by the EU because Yandex was accused of supporting Russian propaganda. After that, Yandex sold its news service. Volozh, who now lives in Israel, spoke out against the war, leading to discussions about nationalizing Yandex.

Foreign businesses leaving Russia

Many big companies, like ExxonMobil and McDonald's, left Russia after the invasion of Ukraine in February 2022. The Turkish company Rönesans Holding also ceased its operations in the Russian Federation.

In December 2023, the international payment system Payoneer, providing financial services and online money transfers, stopped its operations in Russia.

During the summer of the previous year, Match Group, the owner of the dating service Tinder, left the Russian market.

Overall, hundreds of global companies and brands have withdrawn from the Russian market because of the full-scale invasion.