Business Maverick

Business Maverick

Prosus Expects $769 Million Writedown on Its Stake in Russia’s VK

A VK logo displayed at the reception desk inside the VK Company Ltd. office in Moscow.

Prosus NV expects to write off $769 million and asked its directors on the board of social media platform VK Co. Ltd. to resign following sanctions against the Russian firm’s chief executive officer.

The Dutch e-commerce giant owns a 27% stake in VK, one of myriad internet-related assets around the world. Its main other Russian interest is Avito, a classified ads site. Prosus will continue to own and run Avito, CEO Bob Van Dijk told investors Monday, and will support the firm’s Russian staff.

VK CEO Vladimir Kiriyenko was among individuals sanctioned by the U.S. Treasury in the wake of Russia’s invasion of Ukraine. He is the son of Sergei Kiriyenko, the first deputy chief of staff of the office of President Vladimir Putin. Avito isn’t the subject of sanctions, Van Dijk said.

Prosus’s update comes as other international firms move to distance themselves from Russia, which has been hit by a wave of sanctions related to the Ukraine war. Oil majors Exxon Mobile Corp., BP Plc and Shell Plc have initiated plans to sever connections with Russian partners, and Apple Inc. and Nike Inc. both said they would halt product sales in the country.

Read More: Life After Ikea: A Running List of Retail Closures in Russia

In Ukraine, Prosus is helping employees relocate, either across borders or into the west of the country. The war should have a manageable impact of Prosus’s finances, Van Dijk said.

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