Russia’s most popular Internet brand, Rambler Media Ltd. announces that it has agreed to sell its contextual advertising company ZAO Begun (“Begun”) and related subsidiaries to Google. Rambler currently holds 50.1% of Begun. The transaction will consist of Rambler buying the remaining 49.9% stake in Begun from Bannatyne Limited, affiliated with the Finam group of companies, immediately after which Rambler will sell 100% of Begun to Google subject to certain approvals and conditions precedent for a total cash consideration of US$140 million, of which US$69.9 million is attributable to Bannatyne, with customary closing adjustments.

Begun is one of Russia’s leading search and contextual text based advertising services with local expertise, efficient sales systems and the number of its advertisers exceeds 40,000. Begun’s partner network includes over 143,000 Russian language sites.

“Begun is very excited that they will be able to use Google’s technology for contextual ads serving. What Google is looking here for is definitely the ability to reach Russian audience at all as it is very complicated to use AdSense here in Russia.” - said by Svetlana Gladkova from Profy.

“Begun is one of the leading ad services in Russia’s huge market, but knowing Google’s acquisition history, they’re probably not in it only for the market share, but also for the technology.” – by Stan Schroeder from Mashable.

The advertising market in Russia is growing very strongly, and internet advertising is growing twice as fast. Search related text-based advertising on Russian-language internet sites soared to US$225 million in 2007 from US$110 million in 2006. Rambler estimates that internet advertising in Russia will continue to grow at around 50% per annum to reach over US$1 billion in 2010, with an approximately equal split between text-based and display advertising.

“Google is committed to giving Russian users, advertisers and partners the best possible service and experience,” said Mohammad Gawdat, Managing Director Emerging Markets, Google. “This agreement means more Russian users, advertisers and partners will get better search results and more relevant advertising.”