American Uber and Russian Yandex announced the creation of a joint venture

Uber - Yandex.Taxi
Uber - Yandex.Taxi

Uber and Yandex signed an agreement to merge businesses of online travel arrangements in Russia and in some CIS countries (Azerbaijan, Armenia, Belarus, Georgia and Kazakhstan). The value of the merged company is $3,725 billion  in which “Yandex” will receive 59.3%. Delivery service UberEATS food will also be included in these countries’operations.

Under the agreement Uber and Yandex will invest $225 million and 100 million in the new combined company respectively. With these investments and possible adjustments at the time of closing of the transaction 59.3% of the company will belong to Yandex, 36,6% to Uber, and 4.1% to employees. It will be headed by the General Director of Yandex.Taxi – Tigran Khudaverdyan. The transaction has been approved by the Boards of Directors of both companies and is subject to approval from regulators. The deal is expected to close in the fourth quarter of 2017.

Tigran khudaverdyan: “How do the unified platform figures look for June”

  • 127 cities in six countries;
  • 35 million trips per month;
  • 7.9 billion RUB the total cost of travel per month

Experts estimate the total revenue of legal travel carriers in Russia to 501 billion rubles in 2016 (VTB Capital). The “grey” segment was evaluated  to be 116 billion rubles in 2015. Thus, the share of the incorporated company in Russia in 2016 would be approximately 5-6% based on this indicator.

Despite the merger Yandex.Taxi and Uber will continue to operate independently. As explained in the message, the taxis and drivers that work with both services, will move to a single technology platform that “will allow to increase the amount of available cars to carry out the orders, reduce the waiting time, reduce downtime, and improve the reliability and availability of the service as a whole.”

 

1 Comment

  1. According to the transaction documents, after the merger “Yandex” will take part in Ubers’ global business . The Russian company explained that they will receive a “minor stake” in Uber.

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