Russian-linked takeover of a tech company is rejected by Meloni

According to a government document and three persons with knowledge of the situation, Giorgia Meloni, the prime minister of Italy, denied a cloud services provider’s acquisition plan because of the provider’s connections to Yandex, a major Russian internet company.

With this ruling, Meloni’s administration successfully used the so-called “golden powers” rule to thwart undesirable bids in sectors deemed to be of vital importance, including banking, energy, telecommunications, and the healthcare sector.

Following a spectacular electoral victory, Meloni abruptly assumed control last October.

According to a document provided to parliament and made available on the website of the Italian Senate, the veto was decided upon at a cabinet meeting on March 16.

The agreement, which was rejected, would have seen the Netherlands company Nebius acquire the little company Tecnologia Intelligente (TI), which was founded by Marco Carrai, an Italian businessman close to the former Prime Minister Matteo Renzi.

Under the condition of anonymity, two government officials told Reuters that they were worried about the agreement because Nebius’s operations were supported by Yandex.

The holding company for the Russian corporation, which is registered in the Netherlands, intends to sell most of Yandex Group, including its key revenue-generating operations, and to build foreign divisions of some services, notably cloud, outside of Russia. After the restructure, Nebius would be a part of the new worldwide corporation.

Often known as “Russia’s Google,” Early in the 1990s, Arkady Volozh created Yandex. Last year, he resigned as CEO and from the board of directors after the European Union included him to its list of Russian organizations and people subject to sanctions. Western sanctions do not apply to Yandex specifically.

According to Danila Shtan, one of Nebius’s major developers, the company had intended to establish a research and development center in Italy to draw top tech talent from Russia and other countries.

“Unfortunately, this is a slow-moving procedure, but our Dutch holding company is in the process of selling its Russian firm”, said Shtan. “But perhaps after it’s through, we can return to concentrating on technology rather than immigration”.

Deals are typically authorized with recommendations meant to protect the national interest when Italy uses its golden powers.

Nine attempts by foreigners to enter Italy have been thwarted by the government since these powers were established in 2012.

Chinese offers were blocked in six of those cases by the vetoes, while Mario Draghi, Meloni’s predecessor, turned down Rosatom’s bid to buy hydrogen company Faber Industrie last year.

The next significant choice that Meloni’s administration must make relates to the proposed sale of a Sicilian refinery held by Lukoil (LKOH.MM) to the Cypriot private equity firm G.O.I. Energy.

According to certain media reports, the sale of the Priolo refinery, which is approximately 50 kilometers (30 miles) from a NATO installation in Sigonella, has the US government worried.

G.O.I. Energy responded by releasing a statement last month claiming that neither the business nor its CEO, Michael Bobrov, have any ties to Russia.

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