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Sistema could buy Baring's Ozon stake

0 27 November 2013

Baring Vostok, which first invested in Ozon 13 years ago, is planning to reduce its stake in the project. It is in talks with Sistema, the the largest publicly-traded diversified holding company in Russia and the CIS, about a possible deal. 

In 2000 Baring Vostok Private Equity, along with their partner UFG, paid $3 million for a 51% stake in the company. Since then Ozon has held several subsequent rounds, including one in 2011 that raised $100 million, at the time the biggest investment round in Russian VC history. 

Baring now estimates the online retailer to be worth $800 million, although some experts consider that an optimistic estimate. Even if the actual valuation turns out to be lower, Baring is certain to make its second highly profitable sale this year, after it sold a 3% stake in Yandex for $327 million. 

Sistema, a giant conglomerate which is among the top-10 firms in Russia by revenue, is specifically interested in acquiring a controlling stake in Ozon, and is in discussions not only with Baring, but also Ozon’s other shareholders (ru-Net, Index Ventures, Alpha Associates, Rakuten, Cisco Capital and Holtzbrinck Ventures). It is also possible that Ozon itself will sell further shares in the company, as it is currently preparing another $100 million investment round

Ozon was founded in 1998, and now controls five projects - Ozon.ru, an online retail site, O-courier, a delivery firm, Ozon.travel, which sells flights and hotel accommodation, Sapato.ru, a online shoe shop and e-solution, which creates online storefronts and offer other services to retailers. Ozon has 2100 distribution points across Russia and Kazakhstan, as well as its own logistics centre in Tver Oblast. 

According to the firm’s own figures it is growing at an impressive rate - in the first half of 2013 its total revenue was $330 million, 50% higher than for the same period last year. This follows on from 63% growth in 2012. 

Sistema, which only invests in companies valued at over $300 million, owns telecoms firm MTS, children’s retailer Detski Mir and Intourist, a hotel chain, and also has significant interests in the oil and gas industry. You can see its whole portfolio here

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