MOSCOW (Reuters) - Shares in Russian search engine Yandex (YNDX.MM) fell on Monday after a report from the Interfax newsagency said the government was proposing to limit foreign ownership in online news aggregators to 20 percent.
Shares in Yandex N.V. (YNDX.O), the parent company of Yandex group which is registered in Netherlands, were down by almost 2 percent in Moscow following the report.
Yandex is Russia’s biggest internet search engine with around a 56 percent share in Russian search traffic and also the biggest news aggregator compared with rivals Google (GOOGL.O) and Mail.Ru (MAILRq.L).
A Yandex spokesperson said the company was aware of the proposed draft law and was monitoring the situation closely.
“Our board will consider potential restructuring alternatives to help ensure that our news service would be in compliance with any such requirements, if ultimately adopted,” he said, declining to provide any other details.
Interfax, citing a source familiar with situation, also said on Monday that the draft law on foreign ownership, if passed, would not affect Google’s news service.
Google and Mail.Ru declined to comment.
Yandex, with over 20 offices globally, has been listed on the NASDAQ since 2011. Yandex’s services include food delivery and a ride-sharing business with San Francisco-based Uber UBER.UL in Russia, Armenia, Azerbaijan, Belarus, Georgia and Kazakhstan, among others.
Last week, Yandex shares fell sharply on media reports that state-owned bank Sberbank (SBER.MM) could buy a major stake. Sberbank has denied the plan.
Yandex, known as ‘The Google of Russia’, said on Monday it regularly received offers from third parties and could review its shareholder structure but co-founder and CEO Arkady Volozh had no plans to sell his controlling stake.
“I am committed to leading Yandex to new heights, and I have no intention to sell my shares,” Volozh said in the company’s statement. Volozh and members of the company’s founding team control around 57 percent of the company.
This sent Yandex shares up about 8 percent in Moscow, but the Interfax report on the foreign ownership proposal pushed the stock lower.
Yandex also said the “board deliberations may or may not lead to any proposal to change the company’s capital structure or to any potential transaction.” It did not mention Sberbank or any other company in its statement.
According to Yandex’s annual report, Volozh holds 49.2 percent of Yandex voting rights, comprising both Class A and Class B shares. Class B shares have 10 votes per share and Class A give one vote per share.
Sberbank holds a golden share in Yandex, meaning that Yandex’s board should seek the bank’s approval before any decision to sell or transfer the company’s assets “to one or more third parties,” the annual report says.
In the annual report, Yandex said that as of Feb. 15, 2018, there was one holder of its shares based in the United States which held almost all Class A shares, or around 42.10 percent of shares by voting rights. It did not disclose the name.
Yandex said that any decisions related to a possible shareholder structure change would require the board’s approval and approval of the holders of 75 percent of Class A shares.
Reporting by Anastasia Teterevleva; Additional reporting by Maxim Rodionov; Writing by Katya Golubkova; editing by David Evans/Susan Fenton/Jane Merriman