Yandex to Acquire a Property Site for its New Moscow Headquarters
December 18 2018 - 1:00AM
Yandex (NASDAQ:YNDX), a technology company that builds intelligent
products and services powered by machine learning, today announced
that it has entered into binding agreements for the purchase of
rights to a land plot of approximately 4 hectares situated at 15
Kosygina Street, Moscow, Russia (the “Kosygina Site”), subject to
further approvals by the Moscow City Government. Currently, the
Kosygina Site is principally occupied by the Korston Hotel. The
total acquisition cost of the Kosygina Site will be approximately
US$145 million (exclusive of 18% VAT).
"We are very excited with the opportunity to create our own
campus in the heart of Moscow, in close proximity to the science
and educational cluster of Russia. We believe it will allow us to
continue attracting new talent, help us grow, scale and invent new
products and services for our users," says Arkady Volozh, Chief
Executive Officer of Yandex. "From a financial perspective,
we think that the transaction is an effective use of capital and a
prudent approach to managing our operating expenses in the longer
term."
In connection with the planned acquisition of the Kosygina Site,
Yandex has entered into a series of agreements with Orlenok Hotel
Compex OJSC, the owner of the principal facility on the Kosygina
Site, as well as a number of additional owners of smaller adjacent
facilities. The closing of the site acquisition remains subject to
certain conditions, including required regulatory approvals and
actions, and is anticipated to occur in the near term.
Following completion of the site acquisition, Yandex intends to
develop its headquarters design proposal for the site. Yandex will
provide updates on the anticipated timing and expenses, related to
the project development after the required approvals for the
finalized project are obtained. The site acquisition will be
incremental to the group’s capital expenditure plans. The one-off
impact will be immediately recorded in the group’s financials at
the closing of the deal.
As of December 18, 2018, Yandex’s principal Russian operating
subsidiary currently has lease agreements for approximately 88,000
square meters in two office centers in Moscow. This includes
approximately 61,000 square meters in the Krasnaya Roza office
complex, which serves as the group headquarters, under a lease
denominated in U.S. dollars and an additional 27,000 square meters
in the Aurora business park, under a lease denominated in rubles.
Both lease agreements expire on December 31, 2021. Currently,
approximately 6,500 employees work in the group’s offices in
Moscow. For the first nine months of 2018, the group’s aggregate
lease expenses in Moscow represented 340 basis points of the
group’s adjusted EBITDA margin.
Yandex is being advised by White & Case, acting as legal
advisor, and the investment banking division of VTB Capital, acting
as financial advisor in connection with the deal. Cushman &
Wakefield was acting as real estate advisor to the group in
connection with reviewing strategic real-estate alternatives.
Yandex (NASDAQ:YNDX) is a technology company
that builds intelligent products and services powered by machine
learning. Our goal is to help consumers and businesses better
navigate the online and offline world. Since 1997, we have
delivered world-class, locally relevant search and information
services. Additionally, we have developed market-leading on-demand
transportation services, navigation products, and other mobile
applications for millions of consumers across the globe. Yandex,
which has 30 offices worldwide, has been listed on the NASDAQ since
2011.
Contacts:Media RelationsIlya GrabovskyPhone: +7
495 739-70-00E-mail: pr@yandex-team.com
Investor RelationsKatya ZhukovaPhone: +7 495 974-35-38E-mail:
askIR@yandex-team.ru
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