Alisher Usmanov, Russia's richest man, has splashed $1.5 billion to buy the country's answer to Facebook, VKontakte.
Usmanov snapped up the remaining 48 per cent stake in Russia’s most popular social network through his internet company, Mail.ru, in all cash-deal partly financed with a $585 million loan from Gazprombank.
The acquisition hands Usmanov's complete control of VKontakte, which dominates the Russian social media space with almost no competition, and puts an end to a lengthy legal dispute with shareholder United Capital Partners (UCP) and founder Pavel Durov. All sides have now agreed to drop pending litigation, Mail.ru said in a statement.
However the move has raised concerns over freedom of speech when it comes to social media and sharing information online in Russia. Earlier this year, Durov claimed he was fired as chief executive for political reasons and later fled Russia. In response, UCP claimed he was fired for mismanaging the company, which he denies.
In a blog post published in April on his VK account, he wrote: "Today, VKontakte goes under the complete control of Igor Sechi and Alisher Usmanov. In the Russian context, something like this is probably inevitable, but I'm glad we even lasted seven and a half years."
In a separate post, he also claimed Russian intelligence has demanded information about users suspected of participating in the Euromaidan protests, which ultimately led to the downfall of former Ukrainian president, Viktor Yanukovych, after he backtracked on an agreement with the European Union by moving closer to the Kremlin.
Yesterday, Mail.ru insisted the company will continue to operate as usual following the acquisition. Dmitry Grishin, the co-founder and CEO of the group, added: "We respect the successful results driven by VK's team and do not plan any significant changes in the team or the product itself”.
Meanwhile, Durov was quoted in a statement as saying he "welcomes" the decision of his “former partners to abandon their claims” relating to Telegram, a messaging app similar to Whatsapp launched by Durov, and transfer the American entities under his control.Reuse content