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When you are the giant in the Websphere; someone who is considered impossible to compete with, you end up gulping down everything that your mouth can handle and your pocket pay. Google is that giant and it has recently shown this by buying out ZAO Begun; a Russian Contextual Ad firm for boggling price of $140 million as has been reported by Rafat Ali.
The company is owned jointly by Rambler (that owns 50.1%) and Bannatyne Limited (49.9%) and with this deal in place; Rambler would first buy out the remaining shares from Bannatyne Limited and then sell it off to Google. The total profit turn up for Rambler sums to around $50 million as has been mentioned.
Begun made its way to the web six years back and has created an advertising, dealer network and direct sales team in Russia. It had summed up profits around $3.4 million in the first four months for the current year.
As CEO Rambler, Mark Opzoomer commented:
Begun is an excellent business which can become even stronger under Google’s ownership. Google has the advertising technology and financial capacity to build upon Begun’s established advertising network in Russia. By working together, we aim to create superior growth for Rambler, better monetization for our business and stronger value for our shareholders going forward.
The deal was further commented upon by Alexey Basov, General Director of Begun:
The entire industry will benefit from this transaction as there is a high potential for synergies. It brings together Google’s visionary technology and Begun’s six years of successful experience in building advertising and dealer networks and direct sales in Russia.
The deal would turn out to be very benefiting for the ad and search market in Russia apart from bringing Google into the mainland with a thud, as Mohammad Gawdat, Managing Director Emerging Markets, Google remarked:
Google is committed to giving Russian users, advertisers and partners the best possible service and experience. This agreement means more Russian users; advertisers and partners will get better search results and more relevant advertising.
Apart from that there was a separate deal signed by Rambler that stated the collaboration of Rambler.ru, search and advertisement with Google.
