Russian Google, what will happen to Yandex? by Chiara Rossi

Yandex, the Russian Google, is at risk of default. All the details

Yandex, the Russian Google, on the verge of default. The Russian tech giant is not among the Russian companies sanctioned by the West due to the Russian offensive in Ukraine but it could still default. The Nasdaq and the New York Stock Exchange suspended their trading on Monday. Investors holding Yandex bonds have the right to request full redemption, plus interest, if trading in its shares is suspended on Nasdaq for more than five days. "The Yandex group as a whole does not currently have sufficient resources to redeem the securities in full," the company said in a statement. According to Bloomberg, there is $ 1.25 billion involved in the bonds. Today the Russian central bank has decided that the stock exchanges on the Moscow Stock Exchange will remain closed for the whole week, from 14 to 18 March, reports Radiocor today. Founded in 1997, Yandex spent years cultivating an image that was far enough away from the Kremlin to be considered a safe investment. The company's search engine is the largest of its kind in Russia, accounting for more than 60 percent of the country's internet searches in the last quarter of 2021, according to the company. Furthermore, the group has diversified its products in recent years. The company also offers ride-hailing services in several EU countries as well as a food delivery service. The company began trading on the New York Nasdaq Stock Exchange in May 2011. Yandex reached its peak last November, with a market capitalization of over $ 30 billion, decimated to less than $ 7 billion today. Finally, the search engine Yandex is involved in Russian disinformation and propaganda. Although not a Russian state broadcaster, former managers and employees denounce the selection of news that Yandex algorithms highlight on its busiest pages. All the details. THE SUSPENSION OF PRICES IN THE USA On March 4, the Nasdaq and the New York Stock Exchange suspended all listings of Russian companies. The suspension will last until companies explain how they will be affected by the sanctions imposed by the United States and its allies in the wake of Moscow’s invasion of Ukraine. THE POSITION OF YANDEX In a press release, Yandex, which is headquartered in the Netherlands but has its main offices in Russia, said it was not targeted by sanctions. "There are currently no regulatory restrictions on the ability of US, UK or EU people to acquire and trade Yandex stock," he added. MATTER OF DEBT However, the company has warned about the risk of a suspension for more than five trading days. In fact, the owners of certain bonds will legally be able to redeem their debt with interest. "The Yandex group as a whole currently does not have sufficient resources to redeem them in full," the company said. Even if the company were able to obtain financing to pay for it in full, Yandex said such a huge expense “would have a real negative effect on short-term financial position and liquidity. And it could affect our ability to fulfill our other obligations ”. HUNTING FOR CONSULTANTS As Bloomberg points out, financial advisors and lawyers are key to debt restructuring. Since the suspension of the shares on the US stock exchange has triggered a so-called "delisting event", which entitles bondholders to seek full redemption. And the Internet search engine Yandex is struggling to retain consultants. JPMorgan Chase & Co. declined an advisory role on its potential debt restructuring after holding initial discussions. The Latham & Watkins LLP law firm took part in the talks, but on Wednesday the firm released a statement condemning the war in Ukraine and announced its intention to end its presence in Russia. " THE ESCAPE OF UBER In the meantime, the tech giant is also seeing abandonment by its Western partners. On February 28, Uber announced it would remove three of its executives from Yandex.Taxi's board. This is the rideshare joint venture that the companies entered into in 2017. Last year, Uber had already sold part of its stake in Yandex to its Russian partner last year, leaving the Yandex Eats and Yandex Delivery services. The American ride-sharing company said it was trying to "accelerate" the sale of its 29% stake, due to "recent events". THAT OF GRUBHUB US food delivery service Grubhub also reported to the Financial Times that it would end its partnership with Yandex. In August last year, the company announced an agreement with Yandex to provide 100 autonomous robots for transporting food orders to US university campuses. THE DUCKDUCKGO POSITION TAKE Lastly, US-based privacy-focused search engine DuckDuckGo ditched Yandex, the Ft. During a congressional hearing last week, the company said it had stopped using Yandex to provide non-news links on its search engine in Russia and Turkey. "In light of Russia’s assault on democracy in Ukraine, we have severed our relationship with Yandex," said Katie McInnis, head of US policy at DuckDuckGo. OPERATIONS AT RISK Furthermore, the crisis in Ukraine represents another threat to its business, CNN points out. Western companies are in fact cutting off the supply of technology and services to Russian customers. A prolonged suspension of hardware or software sales could damage Yandex over time. "We believe our current data center capacity and other core technologies for operations will allow us to continue operating normally for at least the next 12-18 months," said Yandex. THE COMPLAINT BY THE FORMER HEAD OF THE NEWS DIVISION Finally, Yandex is also accused of supporting the Kremlin’s propaganda on the war in Ukraine. On March 1, former Yandex news division chief Lev Gershenzon posted a Facebook post pointing the finger at the company's complicit role. “The fact that a significant part of the Russian population can believe that there is no war is the basis and the driving force of this war. Today Yandex is a key element in hiding information about the war. Every day and every hour of such “news” costs lives ”, reads the translation of the post provided by journalist Ilya Lozovsky, taken up by Euractiv.

Russian Google