News Worms
News Worms


Uber and Yandex unite business taxi

Uber and Yandex unite business taxi

On Thursday, ride-sharing giant Uber Technologies announced that it has agreed to merge its Russian Federation business with tech company Yandex NV (YNDX - Free Report), better known as the "Google of Russian Federation".

Uber, the developers, marketers, and operators of the vehicle transportation and food delivery service, has announced that it will be forming a partnership with Yandex, who runs the largest search engine in Russian Federation and operates a similar auto transportation service, Yandex Taxi.

Uber will invest $225 million and Yandex $100 million in the new company. Employees will own the rest.

In a joint statement, Uber and Yandex, the so-called "Google of Russia", said that the new company will be worth $3.725bn, in a deal expected to close in the fourth quarter.

"The new company's goal will be to serve the needs of riders, drivers and cities as we develop a fast-growing, sustainable ride-sharing, food delivery and logistics business in the region", Uber Europe, Middle East and Africa head Pierre-Dimitri Gore-Coty said. In 2016, the English-language Moscow Times reported on the three-way fight for business between Uber, Yandex.Taxi, and the Israeli company Gett.

As Uber continues to work through a huge amount of internal management turmoil, the company is also consolidating and rationalising more of its worldwide business. Based on data provided by Yandex, Uber did less than 12 million rides in June 2017, while Yandex.Taxi did close to 24 million.

More than 35 million rides were performed in June between the two operations, collecting more than $130m in gross bookings. The paper value of its stake in Didi was valued at about $6.1 billion at the time of the deal. The more modest nature of this latest tie-up with Yandex reflects the smaller market, but it also goes some way toward improving Uber's balance sheet. The new, unnamed company "will have the right to use Yandex.Taxi and Uber brands in the region", the companies said.

Yandex said the agreement won't change anything for the users, everything will be available on the two apps as before. Uber had been bleeding money in China. According to Uber, the new partnership will allow it to operate in 167 cities while service roughly 35 million trips each month. In all, this new company will operate in 127 cities.

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