Sberbank and Mail.ru Group (MRG) announced that they started a joint venture that will operate in the largest online markets, taxi and food delivery services. Both companies will invest part of their assets in the new O2O platform (online-to-offline) that has an estimated worth of RUR 100 bio ($1.6 bln) and may reach IPO within several years.
The binding agreement between the companies will be signed in the fall. Until then, the parties are to prepare a hefty package of documents and get approval of the Federal Anti-Monopoly Service.
Analysts estimate that Russians spend about half of their family budgets on food and transport. The aggregate worth of these consumer markets in Russia is expected to reach RUR 1 trillion ($15.7 bln) within the next three years.
The partnership will be equal. Mail.ru Group is contributing its Delivery Club and 22.69% of its City Mobil taxi aggregator. The company will also contribute minority shares in related projects. Monetary investment stands at RUR 7.7 bln ($121 mio).
According to MRG CEO Boris Dobrodeyev, the partnership will accelerate the development of Delivery Club and City Mobil assets. However, these two services is only the beginning of a larger О2О holding modelled after Chinese Meituan. Sberbank’s participation is primarily financial. The bank is contributing around RUR 38 bln ($598 mio) and its 35% in Foodplex.
According to the agreements, within a year from the deal, the partners will contribute up to RUR 18 bln ($284 mio) each to the venture. According to First Deputy Chairman of Sberbank Executive Board Lev Khasis, after 12 months, the partners will evaluate a series of key financial and performance indicators to determine the final amount of investment and the size of the partners’ stakes in the venture, which currently range from RUR 37 bln ($584 mio) to RUR 52 bln ($821 mio).
There are no plans to change any of the brands in the near future because they have market strength and recognition. According to Lev Khasis, the current managers of Delivery Club and Citymobil will continue to manage the assets. The candidacy of the head of the new holding has not yet been discussed. The venture’s board of directors will include three members each from Sberbank and MRG, and one seat is reserved for an independent member.
“We at Sberbank love partnerships,” Lev Khasis commented on the joint venture. “We have successful joint businesses with Sistema, Gazprombank, Yandex, and Rambler. Now we have an opportunity to launch a major joint project with a leading Russian Internet holding company.”
By Anna Oreshkina