14 July, 2017
Here's a bolt out of the blue: Uber is partnering with Yandex, the Google of Russia, to launch a new standalone company that merges their respective ridesharing services to target Russia, Kazakhstan, Azerbaijan, Armenia, Belarus, and Georgia. He said Uber is investing $225 million cash in the new company and its 36.6% ownership stake will be worth nearly $1.4 billion; the San Francisco-based company will fill three of the seven seats on the new company's board.
Of course this success would not have been possible without our incredible team in the region and I am pleased to say that as part of today's agreement all full time Uber employees in the countries involved will be part of the new company. The remaining 4.1 percent will be held by employees. At the same time, Yandex will contribute $100 million, and will own 59.3 percent of the company.
"Partnership with Uber will help us broaden the quality of our service and the geographic scope of our business", says Tigran Khudaverdian, the director of Yandex.Taxi, director of the joint venture.
In 2016, Uber realized that it was outmatched by its rival in China, where it spent billions in rider subsidies trying to gain its foothold against rival Didi Chuxing.More news: Sore hip rules Andy Murray out of Wimbledon warm up at Hurlingham
Below is an email sent today to Uber employees from Pierre-Dimitri Gore-Coty, head of Uber's business in Europe, the Middle East and Africa.
Is ride-sharing giant Uber giving up on its China dream? Didi took over the whole business including the platform and rider and driver base. The two companies together predict that they will be offering 35 million rides per month across these countries. 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 San Francisco based company is known for being aggressive in its approach to entering new global markets and will end the costly battle that the two firms have seen drag on for more than three years since the arrival of Uber in Russian Federation. Once that happens, they plan to integrate their driver apps. The new company will be called "NewCo" and operate in 127 cities.