Mail.ru Group, a Russia-based internet conglomerate backed by South African media group Naspers and China’s Tencent, said it would float later this year in the UK to reportedly raise between $500m and $750m.
A source close to the listing said about 10% to 15% of the Mail.ru, which incorporates the investments of former holding company Digital Sky Technologies (DST), would be listed to value the company at $5bn.
Yuri Milner, chairman of Mail.ru, said: "I am very pleased to announce our intention to list on the London Stock Exchange."
Dmitry Grishin, chief executive of the company, added in the statement: "Our communications and entertainment platform targets significant growth opportunities that may arise from the more than 250 million Russian speakers worldwide. We are well positioned to benefit from the expected growth of the Russian internet advertising market and the increase in internet value added services."
Mail.ru said it operated two of the three largest Russian language online social networking sites, Odnoklassniki and Moi Mir; the two largest instant messaging networks in Russia, Agent and ICQ (which it recently bought from AOL); an email service; Russia’s second largest internet portal, Mail.ru; and the country’s largest online games platform.
The company has also made corporate venturing investments in Russia and the Ukraine, including buying 25% of social media group vKontakte and 25.1% of online payments processing group Qiwi (formerly OE Investments). Mail.ru also owns small stakes in US social media companies Facebook (2.4%), Zynga Game Network (1.5%) and Groupon (5.1%).
However, Mail.ru’s planned initial public offering, which is being co-ordinated by investment banks Goldman Sachs and JP Morgan, does not include DST Global, a related company that also holds shares in the US companies.
In July, South Africa-based media conglomerate Naspers used its corporate venturing division to take a direct stake in DST before its integration into Mail.ru.
Naspers already had an indirect holding in DST through its 35% stake in a portfolio company, China-based messaging service Tencent. Tencent bought 10% of DST for $300m in April.
Through its Myriad International Holdings (MIH) subsidiary, Naspers acquired 28.7% of DST for $388m in cash and its 39.3% stake in Mail.ru.
Concurrently, Mail.ru management and other minorities also converted their shares into DST before its was subsequently renamed Mail.ru.