Analysis: where will Yandex get the money for a divorce from Sberbank, and what will happen to its shares

At the end of June 2020, the search giant and the largest bank in Russia announced the withdrawal from joint projects. The largest of them are the Yandex.Money and Yandex.Market money transfer services. Soon after, Yandex announced raising money for development through the sale of shares for $ 1 billion. We figure out what will happen to the company’s securities further.

What happened

As part of a divorce, the search engine will buy back from Sberbank a 45% stake in Yandex.Market. The total valuation of the company is 87.3 billion rubles, the share of the financial institution is estimated at 42 billion rubles. As a result, Yandex will have 100% of the Market.

The second part of the transaction is the withdrawal of Yandex from the Yandex.Money service, the controlling package (75% plus 1 ruble) of which Sberbank has owned since 2013. The Yandex share of 25% is tentatively estimated at 2.4 billion rubles.

It is expected that the transaction will be closed in the third quarter of this year – it has already been approved at the level of boards of directors and boards of the two companies. Sberbank CEO German Gref will soon leave the Yandex board of directors. Of the subtleties – a transaction on Yandex.Market will also require the consent of the Federal Antimonopoly Service.

How Yandex will finance the deal

Sources of The Bell reported that Yandex may send money to buy back its share, which it raised at the beginning of the year through the placement of bonds. Then the company received $ 1.25 billion. In total, at the end of last year, the company had about $ 1.43 billion in its accounts.

The company can partially compensate for the cost of repurchasing Sberbank’s stake in Market through the accelerated placement of new Class A shares. During the placement, Yandex was able to raise $ 400 million – twice as much as was originally planned.

In addition, to raise funds for further development, the company plans to sell its shares for $ 600 million to three large investors – VTB Capital, Roman Abramovich, an investment company, and Treliscope Limited, an investment company.

What will happen to the shares of the company

News about the additional placement of shares and the divorce from Sberbank did not hit the value of Yandex securities – in the period after the news came out, they grew and even updated the historical maximum price on the Moscow Exchange.

In addition, news on the reduction of the premium rate for IT companies from 14% to 7.6% and income tax from 20% to 3% became a supporting factor for Yandex shares.

Even Yandex’s announcement of a possible loss of 4.5 billion rubles in the current quarter did not affect the growth of stocks – for the same period last year, net profit amounted to 3.4 billion. The losses were caused by restrictions introduced due to the coronavirus pandemic, and also losses due to changes in exchange rates.

Analysts and experts predict further growth in Yandex shares. This is also facilitated by the fact that all new investors will be minority shareholders in the company and will not be able to seriously influence its strategy.

Shares of Yandex are traded on the Moscow Exchange. To buy them, you need a brokerage account – open it can online.

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