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The Wall Street Journal: Russian e-commerce startup Ozon raises $150 million

Ozon Holdings Ltd. raised $150 million in funding as the Russian e-commerce startup expands its distribution footprint and aims to speed up deliveries.

The funding was in the form of a convertible loan that can be turned into equity, said Ozon Chief Financial Officer Daniil Fedorov. The round was led by Ozon’s major shareholders: funds advised by Moscow-based privateequity firm Baring Vostok Capital Partners and Moscow-based conglomerate Sistema PJSFC . San Francisco-based venture-capital firm Princeville Capital participated in the round as a new investor.

Baring Vostok and Sistema together invested $100 million and Princeville invested $50 million, the company said. As part of the deal, Princeville Capital Managing Partner Emmanuel DeSousa is joining Ozon’s board.

Mr. DeSousa said his firm was attracted to Ozon’s expanding geographic reach within Russia and the company’s expected growth rate over the next five years.

The deal closed “earlier in 2020,” and its details were worked out before the coronavirus pandemic, the company said.

Since the coronavirus outbreak, the retailer has registered a rise in overall sales as many customers practice social distancing, ordering online to minimize contact with other people, Mr. Fedorov previously told The Wall Street Journal.

Moscow-based Ozon was founded in 1998 and has grown into one of Russia’s largest ecommerce platforms, selling goods such as books, food and apparel. Ozon says it currently delivers more than 200,000 orders daily.

Within the next several years, Ozon plans to spend more than $300 million on logistics, add roughly 2.7 million square feet of distribution space across Russia and open at least five fulfillment hubs, Mr. Fedorov said.

The expansions come as Ozon jockeys against competitors, including Russian internet giant Yandex NV, as more consumers in Russia shift to online commerce from bricks-and-mortar shopping.

Previously, Ozon raised a $250 million funding round in the form of a 2019 convertible loan from funds managed by Baring Vostok Capital Partners and Sistema PJSFC. Other Ozon investors include venture-capital firm Index Ventures, investment firm Alpha Associates and Japanese e-commerce company Rakuten Inc.

Original article:The Wall Street Journal