Billionaire Alisher Usmanov took full control of VKontakte, with his Mail.ru Group Ltd. (MAIL)buying a remaining 48 percent in Russia’s most-popular social network for $1.47 billion.
The all-cash purchase valuing VKontakte at about $3 billion was completed today, Moscow-based Mail.ru said in a statement. The acquisition ends a yearlong fight for control with shareholder United Capital Partners that led to the dismissal of VKontakte Chief Executive Officer Pavel Durov this year. The two sides have now dropped all claims and litigation, Mail.ru said. Its shares jumped as much as 6.7 percent in London.
Usmanov’s Mail.ru is taking full ownership of VKontakte in a bet the site can fend off global leaderFacebook Inc., whose expansion in new regions and on mobile devices has helped push its market value to almost $200 billion. The billionaire is also betting social networks can thrive as businesses in Russia even as President Vladimir Putin’s government imposes greater control over information flows through the Internet.
“The price isn’t low, but it gives Mail.ru domination in Russian social network space and additional opportunities for monetization,” said Konstantin Belov, an analyst at UralSib Capital. “This deal is a milestone for Mail.ru as it will finally be able to consolidate Russia’s largest social network on its balance sheet.”
Mail.ru shares rose 3.4 percent to $31.02 at 1:38 p.m. in London, valuing the company at about $6.5 billion. The stock had slumped 33 percent this year through yesterday.
No comments:
Post a Comment