The Internet company acquired 48% of the social network for $1.47 billion

Mail.ru Group bought 48% of Russia's largest social network VKontakte from Ilya Shcherbovich's United Capital Partners (UCP) fund. The transaction amount was $1.47 billion. Thus, Mail.ru Group became the sole owner of VKontakte.

The Russian Internet company Mail.ru Group announced the purchase of 48% of the social network VKontakte from its second shareholder, the UCP fund, according to Mail.ru Group’s official statement on the London Stock Exchange. The sellers of the shares were Blesmir Development Limited and Palagon Limited.

The amount of the deal closed today was $1.47 billion. Since the first investment in VK shares in 2007, Mail.ru Group has paid $2.07 billion entirely for 100% of VKontakte (VK), the company said. To purchase 48.01% of VKontakte shares, funds in the accounts of Mail.Ru Group, as well as a loan in the amount of 22.2 billion rubles, were used. ($585 million at the rate of the Central Bank of the Russian Federation), provided by Gazprombank for four years at 11.5% per annum. At the same time, UCP, Mail.ru Group and the founder of VKontakte Pavel Durov agree that the parties immediately withdraw all mutual claims with this transaction.

VKontakte's revenue in 2013 amounted to 3.8 billion rubles. (growth by 14%), EBITDA - 1 billion rubles. (an increase of 32%), net profit - 53 million rubles. In the first half of 2014, VKontakte generated revenue of 2 billion rubles, EBITDA amounted to 694 million rubles, and net profit amounted to 248 million rubles. According to comScore, in July 2014, the social network's monthly audience worldwide amounted to more than 92 million users.

According to Mail.ru Group CEO Dmitry Grishin, the consolidation of 100% of VKontakte and the end of the shareholder conflict will allow us to focus on the further development of the product: “We respect the results achieved by the VKontakte team and do not plan significant changes either in the team or in the product itself " UCP partner Victoria Lazareva also confirmed that with the completion of this transaction, all disputes between shareholders are over. “I welcome the decision of my former partners to renounce their claims to Telegram and transfer all American assets under my control,” the message quotes former VKontakte CEO Pavel Durov as saying. “For my part, I withdraw all my claims to UCP and congratulate all parties who participated in resolving the situation."

At the end of August, Mail.ru Group reported in its reports for January-June 2014 that in March it acquired 12% of VKontakte from MegaFon CEO Ivan Tavrin for 12.43 billion rubles. Thus, the entire VKontakte during that transaction was valued at 103.6 billion rubles. (or almost $2.9 billion). In December 2013, Pavel Durov sold his shares in VKontakte (12%) to Mr. Tavrin. The latter already in March ceded its stake in VKontakte to Mail.ru Group, which acquired a total of 51.99% of the company’s shares. According to various estimates, the entire VKontakte in April 2013, when the United Capital Partners fund bought 48% of the shares from the company’s co-founders Vyacheslav Mirilashvili and Lev Leviev, was valued at $1.5–2 billion. It turns out that over the year the social network has risen in price by almost $1 billion

Roman Rozhkov, Maria Kolomychenko

What the owners of VKontakte did not share

As it became known in February, the conflict between the shareholders of the largest Russian social network “VKontakte” (VK) after a public exchange of claims could go into court. At the end of February, United Capital Partners (UCP, owns 48% of VK) announced that it would go to the courts to “protect its rights.” A representative of MegaFon CEO Ivan Tavrin, who owns 12% of VK, promised in response to “demand compensation for damages from the actions of UCP.” Read more

Mail.ru absorbed VKontakte