IVI raised venture loan from Alfa-Bank
OTT VoD service provider IVI has raised RUB 3.7 billion from Alfa-Bank to support the company’s further development and to solidify its market-leading position. The transaction is unprecedented both for IVI and the OTT VoD services market overall.
The bank provided IVI with a venture loan with a maturity of 6 years. According to the terms of the transaction, Alfa-Bank also received the right to acquire 2.5% of the company’s equity under a warrant agreement.
IVI continues to develop despite the complex economic environment in connection with the pandemic. We become the first player in the OTT VoD service market to succeed in raising debt financing from a commercial bank. Alfa-Bank’s investment is a testament to the maturity and economic stability of IVI’s business model, and underscores the significant results that have been achieved by the team. Considering both the equity financing we raised in 2019 and new debt financing raised now from Alfa- Bank, we are well funded to support our future growth and to consolidate our leading position in the market
Given present market conditions and the current stage of development of IVI, the venture loan from Alfa-Bank represented one of the most attractive forms of financing which aligns well with IVI’s strategy both in terms of the cost of capital and minimizing share dilution for IVI’s existing shareholders.
The funds raised will allow IVI to continue investing in its business and strengthen its leadership position in the fast-growing OTT VoD service market in Russia. The company will continue to assess options for raising additional equity financing, including a possible IPO in 2021-2022.
Alfa-Bank has a very positive assessment of IVI’s business model and development prospects. At the same time, taking into account the specifics of OTT VoD services — active investing in expanding market share while having a low share of tangible assets qualifying as collateral for debt — the bank required high-quality expertise and an individual approach to the company’s valuation. Alfa-Bank together with IVI found an optimal, mutually beneficial transaction structure that fully meets the interests of both parties
IVI — №1 OTT Video on Demand service provider in Russia with a monthly audience of over 50 million unique visitors. IVI offers an extensive catalogue of movies, series, and animation with over 80 thousand content units licensed from all Hollywood majors and more than 400 European and Russian independent studios.
Alfa-Bank – the largest private bank in Russia. For 30 years, Alfa-Bank has been leading in all segments of the banking business. The clientele includes about 550 thousand corporate clients and more than 16 million individuals.
At the end of 2019, according to the financial statements (IFRS), the total assets of Alfa-Bank Group, including ABH Financial, Alfa-Bank JSC and subsidiary financial companies, amounted to USD59.47 billion, the total loan portfolio – USD39.8 billion, capital – USD8.1 billion. Total comprehensive income for 2019, including net income and other comprehensive income, increased to USD1.03 billion.