Mail.ru Group Limited Announces Intention to Conduct an Initial Public Offering and Listing on the London Stock Exchange

LONDON & MOSCOW--()--

NOT TO BE DISTRIBUTED OR RELEASED, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES NOR FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART TO THE GENERAL PUBLIC IN THE RUSSIAN FEDERATION.

These materials are not an offer for sale of securities in the United States. Securities may not be sold in the United States absent registration with the United States Securities and Exchange Commission or an exemption from registration under the U.S. Securities Act of 1933. Mail.ru Group Limited does not intend to register any part of the offering in the United States or to conduct a public offering of any Securities in the United States. The information contained herein is not for release, publication or distribution in whole or in part to the general public in the Russian Federation.

This announcement is not a prospectus but an advertisement. Eligible Investors should not purchase or subscribe for any transferable securities referred to in this announcement except on the basis of information in the prospectus to be published by Mail.ru Group in connection with the admission of the ordinary shares in the form of global depository receipts to the Official List of the Financial Services Authority and to trading on London Stock Exchange plc’s main market for listed securities.

MAIL.RU GROUP LIMITED (“Mail.ru Group” or the “Company”), the largest Internet company in the Russian-speaking world based on monthly unique users, today announces its intention to proceed with an offering (the “Offering”) of ordinary shares in the form of Global Depositary Receipts ("GDRs") to be admitted to a Standard Listing on the London Stock Exchange under the ticker “MAIL”. One GDR will represent an interest in one ordinary share of the Company

The Offering

The Offering is expected to consist of outstanding shares (in the form of GDRs) from existing shareholders and is expected to be completed by the end of 2010, subject to market conditions. The Company has appointed Goldman Sachs International and J.P. Morgan as Joint Global Co-ordinators and, together with Morgan Stanley and VTB Capital, Joint Bookrunners in connection with the Offering. Pacific Crest Securities has been appointed Co-lead Manager in connection with the Offering.

Yuri Milner, Chairman of Mail.ru Group said:

“I am very pleased to announce our intention to list on the London Stock Exchange, and we are proud to have reached this important milestone in our Company’s development.”

Dmitry Grishin, Chief Executive Officer added:

“Russia is a very exciting and fast-paced Internet market and we are proud to be at the forefront of developments here. With a highly engaged and fast growing Internet user community, our leading communications and entertainment platform targets significant growth opportunities that may arise from the more than 250 million Russian speakers worldwide. We believe we are well positioned to benefit from the expected growth of the Russian Internet advertising market and the increase in Internet Value Added Services.”

Notes to Editors

The Company

Mail.ru Group is the largest Internet company in high-growth Russian-speaking Internet markets. Mail.ru Group’s sites reach approximately 70 per cent of Russian Internet users on a monthly basis and the Company is the world’s seventh largest Internet business, based on page views1. Russia is today Europe’s second largest Internet market measured by number of users2.

The origins of the Company date back to 1998 and since its formation as a group in 2005, and particularly since the end of 2008, the Company has moved rapidly to build an integrated communication and entertainment platform that allows it to attract and monetise one of Russia’s largest daily Internet audiences. The Company, which is incorporated in the British Virgin Islands, operates two of the three3 largest Russian language online social networking sites (Odnoklassniki and Moi Mir (or “My World”)). The Company also operates the two largest Instant Messaging (“IM”) networks in Russia (Agent and ICQ), Russia’s leading email service and Russia’s second largest Internet portal based on daily and monthly unique users (Mail.ru), and the company operates Russia’s largest online games platform.

The Company holds strategic minority equity stakes in vKontakte and Qiwi (formerly OE Investments). In vKontakte, Russia’s largest social networking site measured by daily unique users, it holds a 24.99 per cent stake and in Qiwi, one of Russia’s leading payment processing companies with a network of over 180,000 Point of Sale (“PoS”) payment terminals, it holds a 25.09 per cent interest. The Company also holds small minority stakes in international Internet companies including a 2.38 per cent equity interest on a fully diluted basis in Facebook Inc.; a 1.47 per cent equity interest on a fully diluted basis in Zynga Game Network Inc.; and a 5.13 per cent equity interest on a fully diluted basis in Groupon Inc. as well as a number of small venture capital investments in various Internet companies in Russia and Ukraine.

* * *

This document is only being distributed to and is only directed at (i) persons who are outside the United Kingdom (subject to applicable laws), (ii) to investment professionals falling within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the “Order”) or (iii) high net worth entities falling within Article 49(2)(A) to (D) of the Order (all such persons in (i), (ii) and (iii) above together being referred to as “Relevant Persons”). The securities are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with, Relevant Persons. Any person who is not a Relevant Person should not act or rely on this document or any of its contents. Persons distributing this document must satisfy themselves that it is lawful to do so.

In connection with the offering, one or more of the underwriters (the “Stabilizing Managers”) (or persons acting on behalf of the Stabilizing Managers) may (but are under no obligation to) effect transactions in the global depositary receipts with a view to supporting the market price of the global depositary receipts at a level higher than that which might otherwise have prevailed in the open market. However, there is no assurance that the Stabilizing Managers (or persons acting on behalf of the Stabilizing Managers) will undertake stabilization action. Any stabilization action may begin on or after the date on which adequate public disclosure of the final price of the global depositary receipts is made and, if begun, may be ended at any time, but it must end no later than 30 days after the date of such adequate public disclosure of the final price of the global depositary receipts. Any stabilization action must be conducted by the relevant Stabilizing Managers (or person(s) acting on behalf of any Stabilizing Managers) in accordance with all applicable laws and rules. Save as required by law or regulation, neither the Stabilizing Managers nor any of their agents intends to disclose the extent of any stabilization transactions conducted in relation to the Offering.

This document is an advertisement and is not a prospectus for the purposes of EU Directive 2003/71/EC (the “Prospectus Directive”) and Part VI of the Financial Services and Markets Act 2000 (the “FSMA”). A prospectus prepared pursuant to the Prospectus Directive will be published in accordance with the prospectus rules made under the FSMA. The prospectus, when published, can be obtained from the Company’s registered office. Investors should not subscribe for any securities referred to in this document except on the basis of information contained in the prospectus.

In any EEA Member State that has implemented the Prospectus Directive this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive.

Information contained in this document is not an offer, or an invitation to make offers, sell, purchase, exchange or transfer any securities in the Russian Federation or to or for the benefit of any Russian person, and does not constitute an advertisement, or offering of any securities in the Russian Federation to any person other than a “qualified investor” (as defined in Federal Law No. 39-FZ “On Securities Market” dated 22 April 1996, as amended). This information must not be passed on to third parties or otherwise be made publicly available in the Russian Federation. The securities have not been and will not be registered in the Russian Federation or admitted to public placement and/or public circulation in the Russian Federation. The Company’s securities are not intended for “placement” or “circulation” in the Russian Federation.

The information contained herein is not for release, publication or distribution in whole or in part to the general public in the Russian Federation.

The materials and information contained herein do not constitute an offer of securities and nothing shall be read or construed as constituting investment advice or recommendations.

This document contains forward-looking statements. Forward-looking statements are statements that are not historical facts, including statements about our beliefs and expectations. Any statement in this announcement that expresses or implies our intentions, beliefs, expectations or predictions (and the assumptions underlying them) is a forward-looking statement. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could therefore cause actual future results to differ materially from those expressed or implied in any forward-looking statement.

The forward-looking statements contained in this announcement are made as of the date hereof, and the company assumes no obligation to update any of the forward-looking statements contained in this announcement.

In connection with the Offering, Goldman Sachs International, J.P. Morgan Securities Ltd., Morgan Stanley, VTB Capital plc or Pacific Crest Securities LLC or any of their respective affiliates, acting as investors for their own accounts, may subscribe for or purchase GDRs and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such GDRs and other securities of the Company or related investments in connection with the Offering or otherwise. Accordingly, references in the prospectus, once published, to the GDRs being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, Goldman Sachs International, J.P. Morgan Securities Ltd., Morgan Stanley, VTB Capital plc or Pacific Crest Securities LLC and any of their respective affiliates acting as investors for their own accounts. Goldman Sachs International, J.P. Morgan Securities Ltd., Morgan Stanley, VTB Capital plc and Pacific Crest Securities LLC do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

Goldman Sachs International, J.P. Morgan Securities Ltd., Morgan Stanley, VTB Capital plc and Pacific Crest Securities LLC are acting exclusively for the Company and no one else in connection with the offering and will not regard any other person (whether or not a recipient of this press release) as their client in relation to the Offering and will not be responsible to anyone other than the Company for providing the protections afforded to their client.

Ends

1   Source: comScore
2 J’Son & Partners (September 2010)
3 Based on monthly unique users. Source: TNS Gallup

Contacts

FD
London
James Melville-Ross or Matt Dixon, +44 (0)20 7831 3113
or
Moscow
Leonid Solovyev, +7 495 795 06 23

Contacts

FD
London
James Melville-Ross or Matt Dixon, +44 (0)20 7831 3113
or
Moscow
Leonid Solovyev, +7 495 795 06 23