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Russian Tech Giant Yandex Says Might Default

"The Yandex group as a whole does not currently have sufficient resources to redeem the notes in full," the company said. TASS / RBC

Russian tech giant Yandex warned Thursday it may default on its debt after it was suspended from trading on New York's digital stock exchange.

Nasdaq and the New York Stock Exchange this week halted all listings of Russian companies until they explain how they will be impacted by sanctions imposed by the U.S. and its allies in the wake of Moscow's invasion of Ukraine.

In a press release published Thursday, Yandex, which is legally headquartered in the Netherlands but has its main offices in Russia, said that it was not targeted by the sanctions.

"There are currently no regulatory restrictions on the ability of U.S., U.K. or EU persons to acquire and trade in Yandex's securities," it added.

Nonetheless, the company, often called the "Russian Google" for its size and breadth of services, said that if it is suspended for more than five trading days, owners of certain bonds will legally be able to redeem their debt with interest.

"The Yandex group as a whole does not currently have sufficient resources to redeem the notes in full," the company said.

Even if the company was able to secure financing to pay them in full, Yandex said such a large expenditure would "have a material adverse effect on our short-term financial position and liquidity and may affect our ability to meet our other obligations."

The company added that it was exploring what financing options were available to it.

Nasdaq, in a response to an AFP inquiry, said that the Yandex listing "remains halted."

In 2021, Yandex earned about 356 billion rubles — about $4.77 billion at the December exchange rate.

The company's search engine, which launched in 1997, is the largest of its kind in Russia, representing over 60% of the country's internet searches in the last quarter of 2021, according to the company.

The group has diversified its products in recent years and now offers a ride hailing and grocery delivery service.

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