Russia’s Yandex, seeking funds for growth, doubles new share offering

By Nadezhda Tsydenova and Olga Popova

MOSCOW (Reuters) – Yandex has doubled the size of its new share offering to $400 million, the Russian internet giant said on Thursday, which combined with private placements will raise $1 billion to finance acquisitions and growth.

Yandex, co-founded by its Chief Executive Arkady Volozh in the 1990s, grew from a search engine to provide everything from online taxi services to food delivery, cinemas and a market place.

This week, Yandex moved to divorce from Sberbank on their two joint projects, Yandex.Market and Yandex.Money, and announced plans to raise $200 million in new shares and another $600 million in private placement to fund the growth.

In the early hours of Thursday, Yandex said that it has issued 8,121,827 new Class A shares, pricing each at $49.25 and effectively doubling the public offering to $400 million.

The increase was due to a high demand, a Yandex spokesman told Reuters. An investor who took part in that deal said that the order book was heavily oversubscribed.

Concurrent with the public offering, Yandex plans to sell another 12,182,739 Class A shares, to be equally taken up by VTB Capital, the investment business arm of VTB bank , and two other companies controlled by three Russian businessmen.

The two other investors are Ervington Investments Limited owned by Roman Abramovich and Treliscope Limited, controlled by Alexander Abramov and Alexander Frolov.

The private deal would also come at $49.25 per share, securing another $600 million.

Goldman Sachs , the sole bank on the both deals, has a 30-day option to purchase up to an additional 1,218,274 Class A shares at the same price. The public offering is to close on June 29.

In total, Yandex is offering 5.8% of its capital excluding the green shoe option which comes at another 0.4%, the spokesman said, with each of the three investors on the private placement getting a 1.2% stake.

On Thursday, Yandex did not say how it plans to spend a total $1 billion from both transactions. Apart from its break

with Sberbank, Russia’s top bank, Yandex may need cash to buy out its U.S. partner from their Yandex.Taxi JV.

Uber has recently valued its 38% stake in Yandex.Taxi at $1.24 billion.

($1 = 69.3730 roubles)

(Writing by Katya Golubkova; Editing by Keith Weir)