Yandex IPO Compiled

IPO at NASDAQ in 2011

Alexandra Pryakhina Khatia Dokhnadze Liana Datunashvili Andrey Zinoviev

FACTS• 28 mln visitors per month

• 4th by queries, 22th by popularity

• Holder: Yandex N.V. (Netherlands)

• Main competitors: Mail.ru Group, Google

• acquisition offers by Google (’03), Microsoft and Yahoo… ⟶ pessimistic future for the Co.

Life before the IPO1990 — “Arkadia"

1993 ⟶ “Yandex”

1997 — yandex.ru search engine

2000 — independent company

2004 — sales increased to $17M

2005 — new office in Ukraine; Ukrainian portal www.yandex.ua

2006 — first remote development office of in SPB

2008 — acquired the ownership rights over “Punto Switcher”

2010 — launch of an English-only web search engine

2008 — application to Nasdaq for an IPO

spring 2011— raised $1.3 billion with the IPO

28 April 2011:

Yandex N.V. ⟶ SEC, NASDAQ

application + announcement

? ☞

1) DEFINED THE PURPOSE OF IPO

2008: first considerations 2010: new considerations

Experts A: “Yandex” is financially self-sufficient, they just need to fix their profits Experts B: competition with Mail.ru Group

Yandex/partners: no comments made

Preparation Stages

2) ANALYSED THE SITUATION

IMAGE: “Western image” as an advantage on the eve of the IPO RISKS concern: • competition (state + private) • copyright • immovables • insurance • health • taxation, legislation • politics • nature of advertising business…

Preparation Stages (contd.)

3) FOUND PARTNERS, WORKED OUT THE PRICING

Preparation Stages (contd.)

• Morgan Stanley • Deutsche Bank • Goldman Sachs • Piper Jaffray & Co. • Pacific Crest Securities • Sberbank

• lawyers • investment banks • consultants

• Price: $25 including the redistribution option

4) SUBMITTED AN APPLICATION detailed, informative,

but with one inflated part

Preparation Stages (contd.)

The day of IPO

• Price before — $ 25 p.s. • First trading session—

$38.84 • 1 hr-rise — 40% • Shareholders’ gain from

the IPO — $873,38 mln • The Co. — $ 365.75 mL

MAY 24, 2011

Yandex after IPOAttracted $1,3 bln (Google — $1,67 bln) Overall evaluation — $8 bln, (500 times its value in 2000)

Drops in price below the IPO value: April’14. Putin’s statement about foreign influence at Yandex October’14. New legislation (data storage, policy to bloggers, payment)