Yandex shares soar after IPO

May 24, 2011, 7:57 PM UTC

Russian search engine Yandex proves that LinkedIn didn’t suck up all the public market oxygen for Internet IPOs.

What a month for Internet IPOs. First came RenRen (RENN), dubbed “the Facebook of China, which raised $740 million on May 4. Then last week’s blockbuster offering for LinkedIn (LNKD), whose shares more than doubled on its first day of trading.

But that was all a prelude to Yandex (YNDX), the Russian search engine that today raised a whopping $1.3 billion. The company priced just over 52 million ordinary shares at $25 per share — compared to a $22-$24 offering range — which gave it a market cap north of $8 billion. Morgan Stanley, Deusche Bank and Goldman Sachs served as co-lead underwriters.

The real question now is if Yandex will more closely resemble RenRen, whose shares surged briefly before slumping below their IPO price, or LinkedIn, which took a hit yesterday but is still trading well above Reid Hoffman’s most optimistic dreams.

We’ll have to wait a while for a definitive answer, but do know that Yandex opened trading at $35 per share, and has remained in that general range. We also know that almost any price will represent a massive return for Russian investment firm Baring Vostok Capital Partners, which led a 5% investment in 2000 for a 36% ownership stake (SecondMarket tells Fortune that it did not transact any private trades of Yandex stock prior to the IPO).

It also will be interesting to see what analysts use for market comps, since Yandex is unique. Some have referred to it as Russia’s Google, because it generated 64% of all Russian search traffic in 2010 and is the largest Russian Internet company by revenue ($439 million last year). The difference, however, is that almost all of that revenue came from advertising, whereas Google is much more diversified.

Moreover, Yandex has major political risks that make Google’s anti-trust dust-ups look like schoolhouse slaps. For example, the KGB’s successor organization recently ordered Yandex to turn over contributor data to an anti-corruption website focused on government-owned companies. In that way, it has some shades of RenRen (without the Chinese market’s massive growth potential).

Maybe investors will just view Yandex as a standalone, to rise or fall on its own merits. So far today, it’s been handed a pretty large ladder.