VK wants to buy Skyeng online school

VK continues to search for assets in the Russian Internet market. This time the company plans to strengthen its Edtech direction. As The Bell found out, the company is discussing a deal to buy the online language school Skyeng. This is the last major independent player in the Russian online education market. However, the sale of VK is not the only option Skyeng shareholders are considering. The other is access to the Moscow Exchange.

What's happened

VK claims to buy another major Russian online service. This time it's about the Skyeng online school, two interlocutors close to both sides told The Bell. The companies entered into negotiations on the deal, but no binding documents have yet been signed, they say.

Now there is no clear leader in the commercial education market. And VK has every chance to become one - and Skyeng can be a useful acquisition along the way, explains The Bell source familiar with the company's plans. But if the Edtech services that VK bought before were quite deeply woven into the business of the group, then Skyeng, if the deal ever happens, is more likely to develop independently, he adds: “There is an understanding that the service will develop better on its own than in imposed integration.

True, VK is not the only potential buyer for Skyeng, the source of The Bell claims. Shareholders of the online school are negotiating with other major players in the online education market. Among them, for example, Alexei Mordashov's Severgroup, which, through the TalentTech IT holding, owns 85% in the Netology Group Edtech company.

VK also has a strong position in the online education market: its holding Skillbox Limited (which includes Skillbox and Geekbrains online schools, VK owns 50.06% in it) became the leader of the Edtech market in 2021 with a revenue of 10.4 billion rubles , analysts of Smart Ranking considered . The entire market was estimated at 73 billion rubles, which is 70% more than in 2020.

In addition, VK owns a 25% stake in the Uchi.ru online platform for schoolchildren, 45% in the Tetrika service, and another 11.7% in the Algorithmika programming school. True, despite the group's great interest in Edtech, the direction has so far brought losses to it: EBITDA of the Skillbox Limited holding last year amounted to minus 1.6 billion rubles. In addition, at the end of 2021, "mass layoffs" took place in the Skillbox and Geekbrains services, wrote . Vedomosti

Other options

At the beginning of this year, Skyeng had plans to conduct an IPO on a foreign exchange, a source familiar with the company's plans told The Bell. However, after February 24, they were thwarted, he continues.

“The main task now is to survive and make sure that the business that has been built over the past 10 years does not go down the drain,” explains The Bell source. To do this, the company needs to look for ways to attract money, as well as to become "more understandable to the state," he continues. Selling a share to a major player is only one of the possible solutions to the problem. The other is access to the Moscow Exchange, says the source of The Bell.

In October 2020, Skyeng attracted investments from the Winter Capital Partners fund, whose key investor is billionaire Vladimir Potanin. In addition, among its shareholders is the Baring Vostok fund. In 2020, Forbes valued Skyeng at $130 million.

VK declined to comment on the topic. Skyeng said they do not comment on rumors and have heard such speculation many times over the past five years. “At the same time, we have always considered and are considering both going public and strategic partnership as an important stage in the development of the company,” the company added. TalentTech did not respond to a request.

VK Plans

VK has big plans to acquire Russian Internet companies. First of all, after the start of the war, VK agreed in March to buy its News and Zen services from Yandex. “Zen is the only large content platform in Russia that is not owned by VK. If you add it to VKontakte and Odnoklassniki, you get the entire audience of Runet, ” explained . an interlocutor of The Bell, who is familiar with the company’s plans,

Among other possible purchases of the group is the online classifieds service Avito with its 92 million users. As The Bell wrote , VK actively claims to buy it, but the shareholders themselves do not want to be sold to the group (read more about this here ).

Finally, VK is actively involved in the fight for ivi, found out The Bell . The fact that the largest online cinema in Russia in terms of revenue was put up for sale was reported in May by Kommersant. At that time, MTS was called the main contender for the purchase of the asset. However, VK also has quite serious intentions in these negotiations, according to The Bell interlocutors. The group does not yet have its own online cinema, and ivi is one of the market leaders.

VK is laying claim to almost every major Internet asset for sale in an attempt to become Russia's premier IT company. We talked about this in more detail in the latest issue of the tech newsletter .