Page 6 - bne_Tech_07_2020

Leaders
July 2020 www.intellinews.com I Page 6
Divorce between Yandex and Sberbank welcomed by analysts
The final split of joint assets between Russian internet major Yandex and the country's largest bank, Sberbank, is seen as a rare win-win situation by the analysts.
As reported by bne IntelliNews, in 2019 Yandex struck a corporate governance deal with the Kremlin, calming concerns of a state takeover of the company, but at the price of a fallout in the relationship with another investor darling, Sberbank.
Now Yandex will buy out the 45% stake in their Yandex.Market (e-commerce marketplace Beru) joint venture for RUB42bn (RUB87bn valuation) and will sell its stake in Yandex.Money (for RUB2.4bn).
"The split is logical, in our view, as competition between the two ecosystems has intensified since Sberbank created an O2O joint venture with Mail. ru and said that there might be difficulties in running the e-commerce JV [with Yandex]," VTB Capital (VTBC) commented on June 25.
Rare win-win deal
VTBC believes that the deal is a rare "win-win" for both companies. "It allows Yandex to develop a fintech vertical, while e-commerce is high on Sberbank’s ecosystem priority list, and we believe the bank will look to partner with an existing Top- 3 player," VTBC wrote.
bne IntelliNews reported that Sberbank is now reportedly eyeing to buy 30% in e-commerce major Ozon from the latter's shareholders
(multi-industry investment holding AFK Sistema and Baring Vostok).
VTBC sees that split as positive for Yandex and notes that Sberbank estimates a RUB20bn ($289mn) profit from the deal.
Yandex.Money well-positioned
The Yandex.Market e-commerce JV with Yandex was created in 2017 with a RUB30bn investment from Sberbank for a 45% stake, BCS Global Markets commented on June 25. For 3M20, Yandex.Market net loss totalled RUB2.7bn, while Yandex.Money net profit totalled RUB450mn.
Yandex.Money has developed well since 2013, with turnover up 13-fold to RUB503bn and Ebitda surging 16-fold to RUB2.9bn. The service holds leading positions across B2B and B2C segments. Still, the financial impact of Sberbank’s non- banking segments is limited at circa 3% of revenue, BCS GM notes.
For Sberbank, the sale of a 45% share in Yandex. Market with RUB20bn profit and the consolidation of 100% in Yandex.Money may support new developments in the ecosystem, but creates
a new strong competitor in e-commerce, BCS GM warns.
VTB could replace Sberbank after share issue
As reported by bne IntelliNews, Yandex is issuing additional shares to finance the deal with Yandex. Market, with Russia's second-largest bank VTB coming to replace Sberbank with $200mn capital participation, or just over a 1% stake, in Yandex.