Russia's Yandex warns of bond repayment and supply risks (updated)

VK

04/03/2022 13:20

(Adds detail)
    MOSCOW, March 4 (Reuters) - Russian internet giant Yandex
 YNDX.O  on Friday warned that a trading suspension on its
Nasdaq-listed shares could trigger a redemption right on a
convertible bond that it does not have the resources to cover. 
    Unprecedented Western sanctions over Moscow's invasion of
Ukraine have hammered Russia's financial system and investors
have dumped Russian assets from the rouble to bonds and stocks.
    Yandex said that a suspension of trading of its Class A
shares on Nasdaq of more than five trading days would give
holders of those notes the right to require Yandex to redeem
them at par plus accrued interest under the terms of its 0.75%
convertible notes due in 2025. 
    "The current principal amount outstanding is $1.25 billion.
In the event that such redemption right was triggered, we would
be required to issue a notice within five calendar days
informing the holders of the notes of their redemption rights,"
Yandex said in a statement. 
    "The Yandex group as a whole does not currently have
sufficient resources to redeem the notes in full."
    
    SUPPLY CONCERNS
    Yandex has avoided sanctions, but like all Russian companies
it has suffered reputational damage. Lithuania asked tech
companies to remove the app for Yandex's ride-hailing service
from their stores this week.  urn:newsml:reuters.com:*:nL1N2V320N
    "None of Yandex N.V., any of our subsidiaries, any of the
members of our board of directors or management or any of our
principal shareholders is a target of these sanctions," Yandex
said. 
    However, the company said the suspension of supplies and
services to Russia by a number of foreign companies could
adversely affect some of its operations over time.
    "We believe that our current data centre capacity and other
technology critical to operations will allow us to operate
normally for at least the next 12 to 18 months," it said. 
    Companies ceasing shipments of consumer goods to Russia
could also reduce its e-commerce offering, Yandex said.
 urn:newsml:reuters.com:*:nL8N2UQ2WV
    The company said it is aware of speculation that the Russian
government may try to take control of companies or assets in
Russia in response to sanctions. Yandex competitor VK  VKCOq.L 
became state-controlled late last year.  urn:newsml:reuters.com:*:nL8N2SO3IY
 urn:newsml:reuters.com:*:nL5N2V601G
    "Although we are not aware of any plans in this regard, the
majority of our operations and assets are located in Russia and
therefore any such action would have a material adverse impact
on the value of the Yandex group as a whole."

 (Reporting by Reuters in Moscow
Editing by David Goodman)
 ((moscow.newsroom@thomsonreuters.com;))