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Russian Authorities Halt Google Acquisition

Paperwork screwup or polite "screw off"?

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Like a hockey player who wasn’t expecting a body check, Google’s gotten an unpleasant surprise in the antitrust department.  Even as the company was focused on its deal with Yahoo, Russian authorities have stopped its acquisition of Begun.

The purchase seemed to have been wrapped up three months ago, when Google and Rambler Media (Begun’s old owner) agreed to the price of $140 million.  Russia’s online population is growing fast, so the advertising company represented a good way for Google to get its foot in the door and start making money.

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But either Google forgot to fill out some forms, the paperwork was lost, or the Russian government disapproves of the deal.  Svetlana Gladkova writes, "[T]he authorities claim that Google has not submitted the complete information on all the personnel of the company working in Russia.  Absence of this information was supposed to prevent the antitrust agency from evaluating the consequences of such a deal correctly."

She then continues, "I believe it is quite obvious that the authorities have decided that increasing Google’s presence in the Russian contextual advertising market could potentially damage the market and the competition."

So we’ll just have to see whether the issue is resolved quickly or not.  Google’s no doubt got emails, faxes, and traditional letters on their way to Russia’s Federal Antimonopoly Service at this moment.

Russian Authorities Halt Google Acquisition
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  • http://www.thenetworkgarden.com Mark Sigal

    There is a great article on Putin’s Russia (‘Dead Soul’) in the October issue of Vanity Fair that provides some framing on this topic. Unfortunately, VF didn’t put the article online, but I a blogged on it so check out the following post if interested:

    Why Experience Matters: On Palin, Putin and Prudence
    http://thenetworkgarden.com/weblog/2008/09/why-experience.html

    Cheers,

    Mark

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