Uber has been struggling a lot recently and its CEO Travis Kalanick was ousted in a corporate shakeup due to bad managerial practices and toxic culture. After its consolidation and JV with the Chinese counterpart Didi Kaudi, the Russian leg of the business has also announced in a major move that it will be combining its rides-on-demand business and UberEATS( its food ordering and delivery business) with Yandex Taxi, the ridesharing business built up by the Russian search giant which also happens to be the current leader in the market. A new entity valued at $3.72 billion will be created for this JV.
Uber is putting in $225 million and Yandex $100 million into the new entity giving Yandex a 59.3 share and Uber a 36.6 percent share, with 4.1 percent owned by employees of the company.
“This combination greatly enhances Yandex’s ability to offer better quality service to our riders and drivers, to quickly expand our services to new regions, and to build a sustainable business,” says Tigran Khudaverdyan of Yandex.Taxi in a statement. “The combined companies currently perform over 35 million rides a month while growing over 400% year-over-year. Since founding Yandex.Taxi in 2011, we have connected tens of millions of riders and drivers tobecome the largest and most trusted ridesharing business in Russia and neighboring countries. We are excited to expand on this foundation in collaboration with Uber.”
“Not only is this partnership good news for our two companies, it’s also great for riders, drivers and cities across the region. This deal is a testament to our exceptional growth in the region and helps Uber continue to build a sustainable global business,” says Pierre-Dimitri Gore-Coty, Head of Uber in Europe, the Middle East and Africa.
“NewCo will draw on the strengths of Yandex, the search, maps and navigation leader in the region, and Uber, the global ridesharing leader, to develop a fast-growing, sustainable business that best serves the needs of riders, drivers and cities,” the company said in a statement.
According to company’s statement users will be able to use both the yandex app and uber’s app for booking rides.