Recently Yandex (YNDX) announced a change in its plans – to assuage the Kremlin’s fears regarding possible foreign influence over Russia’s by far the biggest technology company.
Yandex, as a provider of various services such as taxi aggregation or search engine, is often referred to as ‘Russian Google’. The corporate ownership has changed due to foreign shareholdings in Russian internet firms being limited by merely 50%. That, in turn, reflects the concerns of the Russian policy makers over a focus of information control being effected by various foreign countries.
According to Yandex’s annual report, the parent company of Yandex Group, Yandex N.V., is registered in the Netherlands and its Chief Executive, Arkady Volozh, holds 48,41% of the voting rights in the company.
The company has suggested to create a Public Interest Foundation (PIF) consisting of 11 Russian nationals that would oversee a “golden share” that is owned by the state-owned Sberbank at the moment. In case this foundation is indeed registered, it will enjoy a right of veto.
The Kremlin spokesperson, Dmitry Peskov, announced that the plan was not yet officially presented to the Kremlin. However, he also noted the Kremlin had been kept updated of the project’s advancement, while Yandex has a major influence over Russia’s media industry and therefore should be fully aware of its responsibility.
Presumably, this new board will consist of three members coming from Yandex senior management team, namely, “Volozh, deputy CEO Tigran Khudaverdyan, and HR Director Elena Bunina”. They might be joined by representatives from five major Russian universities, as well as three non-governmental organizations. The powers of the foundation might even include blocking a single entity accumulating 10% or more in economic or voting interest.
Critics are sceptical of the envisaged changes. They believe that through such steps the government is trying to limit personal freedom and take full control over the internet. However, the Kremlin states that it is only trying to “protect the integrity of the Russian-language internet.”
Even though the proposed changes are subject to shareholders’ approval, Yandex already agreed to the repurchase of class A shares of Yandex N.V. worth $300 mio in the aggregate. That pushed Yandex shares’ price up by about 6,6% as of noon GMT. Yet to reassure the Kremlin, Volodz promised not to sell until 2022 95% of class B shares he holds.
By Natalia Revishvili, ForexNewsNow.com