CORRECTION: Telegram trying to raise capital

RUSSIA / FSU POLITICS - In Brief 20 Feb 2021 by Alex Teddy
The messaging app seeks to raise USD 1 billion through the issuance of 5-year bonds to a restricted number of investors. Kommersant newspaper reported on February 18 that Telegram set the minimum investment value USD 50 million. The company might cut it to USD 10 million if needs be. The aim is to offer a 7-8% yield on the bonds. Telegram might opt for an IPO in the next few years. If they do, then bond holders shall be able to turn the debt into equity with a 10% discount in relation to the company's share price.Many would want an ownership stake in Dubai-based Telegram. At the moment its founder Pavel Durov owns it. Telegram has burgeoned over the last few years. It is the world's 11th most popular social network. It has overtaken Snapchat and Twitter. Telegram wants to monetize soon by bringing in advertising channels and adding paid extras. Telegram is one of the few apps not to have banned Trump. Telegram is raising money because it has been funded by Durov. As Telegram wins more and more subscribers the cost of keeping it operational and upgrading its infrastructure is increasing. In 2018 Telegram said its spending would rise from USD 70 million to USD 220 million in 2021.Durov also needs funding because he has run afoul of US regulations. In 2018 Telegram sold a cryptocurrency in an effort to raise money for a blockchain project called Telegram Open Network (TON). The US SEC said this broke US securities law and ordered Telegram to refund USD 1.2 billion to investors out of a USD 1.7 billion raised. A small fine was also imposed. An IPO would be inadvisable in the current climate. Telegram will attain a higher valuation if it monetizes its platform and does the ...

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