Yandex warns note holders of risk of non-fulfilment of obligations

MOSCOW, Mar 4 (PRIME) -- Yandex, the Netherlands-registered parent company of Russian Internet giant Yandex, has warned holders of convertible notes that it will not be able to redeem a majority of them as of Friday if the holders decide to exercise their right, the company said in a statement late on Thursday.

“On Monday, February 28, 2022, the Central Bank of Russia announced that the Moscow Stock Exchange would be closed at least through Friday, March 4, 2022. Also on February 28, Nasdaq and the New York Stock Exchange imposed as suspension of trading in securities of a number of companies with material operations in Russia, including Yandex, which currently remains in place,” the company said.

“Under the terms of our 0.75% convertible notes due 2025, in the event of a suspension of trading of our Class A shares on Nasdaq of more than five trading days, the holders of those notes would have the right to require us to redeem their notes at par plus accrued interest. The current principal amount outstanding is U.S. $1.25 billion. In the event that such redemption right was triggered, we would be required to issue a notice within five calendar days informing the holders of the notes of their redemption rights.

“The Yandex group as a whole does not currently have sufficient resources to redeem the notes in full. In the event that we were prevented from distributing additional funds from our Russian subsidiaries to our Dutch parent company, Yandex would not have sufficient resources to redeem a majority of the notes.”

Yandex also said that none of the Netherlands-registered company or any of its subsidiaries, any of the members of the board of directors of the management board or any of the key shareholders is a target of the anti-Russia sanctions.

“We are currently analyzing the new export controls and working closely with our vendors. None of the Yandex group companies operates in the defense, aerospace or maritime sectors that have been specifically targeted,” the statement read.

As of Monday, Yandex had U.S.- and euro-denominated cash balances of approximately $615 million, of which a U.S.-equivalent of approximately $370 million is located outside of Russia, and about 47 billion rubles of ruble cash and cash equivalents.

“We do not currently expect the blocking of certain financial institutions in Russia from the SWIFT system to affect our day-to-day operations. Any prolonged economic downturn in Russia as a result of the sanctions, depreciation of the ruble or negative consumer sentiment could have a material adverse effect on our results,” Yandex said.

(111.7564 rubles – U.S. $1)

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