MAIL.RU GROUP LIMITED (“Mail.ru Group” or the “Company”) today announces that in line with its ongoing focus on delivering the widest possible user experience in its social networks and the success over the last 2 years in building a sustainable, and fast growing music subscription base, the Company has signed an option agreement for acquisition of the remaining 80% of UMA with the option period ending on 21 May 2020.

Mail.Ru Group’s relationship with UMA helped to normalize relationships with copyright holders and create the biggest music eco-system on the Russian market. BOOM, a dedicated music app by UMA, providing extensive music streaming and caching features, has about 1m subscribers and is one of the top grossing apps for Russia both in Apple’s AppStore and in Google Play. It has one of the largest libraries on the market with over 35m tracks. Together with music subscribers on VK and OK Mail.Ru Group will have about 2.1m subscribers for its music offering making it the largest content subscription user base in Russia. Music features on social networks are both driving user engagement and help build platform for the young talented artists to promote their music connecting them with fans. 

In May 2018 Mail.Ru Group acquired 20% of UMA. Following the exercise of the option for the remaining 80% of UMA, Mail.Ru Group will have 100% ownership of BOOM. Going forward music will remain a key part of the user experience inside of the social networks but the Company will also look for further ways to strengthen its relationships with copyright owners. Mail.Ru Group is also exploring various potential partnerships where UMA may further expand its content offering.

The purchase price of 80% of UMA under the option agreement is USD 97m. Option exercise is scheduled on Q1 2019 subject to the preliminary approval from the Federal Antimonopoly Service of Russia being obtained. The parties to the Option Agreement are Limited Liability Company “Mail.ru Group” as the Buyer, and the current shareholders of the target company being White Peak Investments (IOM) PCC Limited, Crescent & Star Investment Company LLC and others as the Sellers. As with all previous acquisitions and disposals we will present the numbers on a pro-forma basis in order to allow like for like comparisons. UMA is expected to have 2018 revenues of around RUB 1.4bn. There will be no material impact on EBITDA.

Commenting on the option exercise Boris Dobrodeev, CEO (Russia) of Mail.Ru Group said: ”Our music and content offerings have been a very important driver for the ongoing increased user engagement. In bringing UMA in-house we now have the opportunity to create a wider eco-system which can benefit artists, copyright holders and give the best possible user experience. We expect to see continued strong growth in subscriptions and we will also look to expand the user offering to wider formats over time.”

For further information please contact:

Investors:

Matthew Hammond

Mail.Ru Group

Phone: +971 505 56 1315

E-mail: hammond@corp.mail.ru

Press

Olga Zyryaeva

Phone: +7 909 974 5996

E-mail: o.zyryaeva@corp.mail.ru