Yandex, often referred to as “Russia’s Google,” has announced its decision to pull out of its home country. The Dutch-based parent company of Yandex sold its Russian operation for 475 billion roubles ($5.2bn; £4.2bn), a price significantly lower than its estimated market value. This sale means that Yandex’s Russian business is now fully owned by Russian investors.
The move comes after Yandex faced accusations of hiding information about the war in Ukraine from the Russian public. Despite its nickname as “Russia’s Google,” Yandex has no affiliation with the US search engine giant or its parent company, Alphabet.
The sale to a consortium of investors was welcomed by Moscow, with Anton Gorelkin, deputy head of the Russian parliament’s committee on information policy, stating, “This is exactly what we wanted to achieve a few years ago when Yandex was under threat of being taken over by Western IT giants.” He emphasized that Yandex is not just a company but an asset of the entire Russian society.
Established during the dotcom boom in the late 1990s, Yandex developed its own search engine, mapping, and advertising businesses. It also offers services such as taxis and food delivery. The $5.2bn deal is significantly lower than Yandex’s market value, which was estimated to be around $30bn in 2021.
The exit of foreign-owned businesses from Russia has become a common occurrence since the country’s invasion of Ukraine. Many companies have sold their assets on unfavorable terms, while others have faced seizure by the Russian government. Western brands like Danone and Carlsberg have also had their assets seized.
Arkady Volozh, co-founder of Yandex, is one of the few prominent Russia-linked businessmen to publicly speak out against Russia’s invasion of Ukraine. He left the company in 2022 and has been hit with sanctions by the European Union. The EU claims that Yandex is responsible for promoting Russian state media and narratives while suppressing content critical of the Kremlin. Volozh is seeking to have the sanctions removed, stating that he was never close to Russian President Vladimir Putin.
To comply with the Russian government’s content demands, Yandex sold some of its online resources to state-controlled rival VK in late 2022. Despite presenting itself as independent, experiments conducted by BBC Monitoring in 2022 revealed that Yandex’s search results failed to report Russian atrocities in the Ukrainian city of Bucha.
The decision by Yandex to pull out of Russia reflects the challenging environment for foreign-owned businesses in the country. While the sale may have been below market value, it allows Yandex to maintain its operations and independence within Russia. The move also aligns with the Russian government’s desire to have greater control over its digital landscape. As Yandex continues to evolve, it remains to be seen how this shift will impact its future growth and influence within Russia and beyond.
