An entity formed of senior Yandex managers will become the Russian internet company's largest shareholder with a 35% stake should a $5.2 billion cash and share deal go through, Yandex NV said in a shareholder circular on Thursday.
Yandex NV, the group's Dutch-registered holding company, said the divestment of its Russia-based businesses, which account for more than 95% of Yandex's revenue, would be put to a shareholder vote on March 7.
A group of up to 50 members of the management team would take a 35% stake, the shareholder circular said.
Infinity Management, a company owned by Alexander Chachava, would purchase a 25% stake; IT.Elaboration, owned by Pavel Prass, and a fund owned by oil major Lukoil (LKOH.MM) would take 15%; and Meridian-Servis, owned by Alexander Ryazanov, would acquire a 10% stake.
Yandex NV said it had conducted extensive due diligence on the consortium's members, including background checks by an international investigations firm and discussions with relevant authorities in the United States and European Union.
The share purchase agreement includes sanctions-related warranties, Yandex NV said, that no members of the consortium or affiliates are under sanctions and that each buyer acts as principal and not as an agent.
Should any member of the consortium be sanctioned before the deal's first closing, expected in the first half of 2024, the consortium will seek replacement funding, Yandex NV said.
Yandex NV highlighted recent laws that potentially restrict the rights and influence of foreign shareholders, and Russia's seizure of foreign-owned assets in the last two years, as evidence of the significant risks to its ownership and control, and encouraged shareholders to approve the deal.
Eight alternatives to the deal were considered, Yandex NV said, but all were ruled out for reasons such as being too complex, or offering too little benefit to shareholders.
($1 = 91.2050 roubles)
