After exiting the Chinese market, Uber has merged its Russian business with the taxi/ridehailing side business of Yandex, Russia's dominant search engine:
After selling its Chinese business in August last year, Uber has now yielded its clout abroad again — this time to merge its Russian business with the taxi arm of Russian search engine giant Yandex. The new company will be worth $3.725 billion, both companies have announced, and span 127 cities in 6 countries (Russia, Azerbaijan, Armenia, Belarus, Georgia and Kazakhstan).
As part of the deal, Yandex will invest $100 million and hold a majority stake of 59.3 percent, while Uber will invest $225 million and hold a stake of 36.6 percent. The remaining shares are held by company employees. Full-time Uber employees in the countries involved will join the new company. A name for the new company has not yet been announced.
Also at Recode and NYT. Uber statement.
Related Stories
Uber has exited the Southeast Asian ride-hailing market with a sale to Singapore-based Grab, which also operates in Malaysia, Indonesia, the Philippines, Vietnam, Thailand, Myanmar, and Cambodia:
Uber is selling its South East Asia ride-share and food delivery businesses to regional rival Grab. The move marks a further retreat from international operations for Uber, after it sold its China business to local rival Didi Chuxing. Both firms describe the deal as a win for their passengers, but analysts warn it could mean higher prices.
Grab is South East Asia's most popular ride-sharing firm with millions of users across eight countries. Under the terms of the deal, Uber will take a 27.5% stake in Singapore-based Grab. Uber's chief executive, Dara Khosrowshahi, will also join Grab's board.
SoftBank is the biggest investor in both companies, and could also engineer an Uber exit from India, where it competes with Ola:
[...] real victory unquestionably belongs to Masayoshi Son's SoftBank Group Corp., the single-biggest investor in both companies. As I wrote earlier this month, by engineering a retreat for the U.S. company before any more bloodletting for market share, Son ensures that six-year-old Grab will emerge as an early champion in a winner-takes-all business.
A faster path to profit for Uber could also boost its valuation ahead of a planned IPO next year. But at what cost? Having already surrendered China to Didi Chuxing, beating a retreat from Southeast Asia is a precursor to perhaps losing India, the lone remaining jewel in Uber's once-flourishing Asian empire.
In India, once again, SoftBank is the largest investor in Uber's main rival, Ola. Competition between the two apps has become ridiculous. For all the PR gobbledygook on how happy Uber and Ola drivers are, the reality is that many who took out bank loans to acquire new cars are hurting badly. There's a glut of ride-hailing cars; wages have collapsed. Banks are collecting on "DUD," -- my moniker for "distressed Uber debt" -- by repossessing vehicles.
Uber's new CEO, Dara Khosrowshahi, says there will be no more exits from global markets (in addition to China, Uber also left Russia). But SoftBank may continue to pursue a strategy of exiting emerging and less profitable markets in exchange for large stakes in competitors.
Related: SoftBank's $80-100 Billion "Vision Fund" Takes Shape
SoftBank to Invest Billions in Uber
SoftBank Devalues Uber by 30% With Latest Offer
SoftBank Acquires 20% of Uber While Massively Devaluing It
(Score: 0) by Anonymous Coward on Friday July 14 2017, @05:16AM
The Deuce you say! Uber, merging with Yandoo, the Ravager, to provide better service to Nova Prime? Sounds like a scam. I like to say, when stuff like this comes up, "Submerge!" Uber is an illegal, exploitative, organization. They should do well in Russia. Until someone the bullet in their head puts. In Post-Soviet Russia, the Deal Arts YOU!
(Score: 0) by Anonymous Coward on Friday July 14 2017, @05:39AM
The best eggs come from worker-owned coops, but employees only own 4.1% of this company. Richard Wolff would not approve.
🐔🐔🐔🐔🐔🐔🐔🐔🐔🐔🐔🐔🐓
🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚
🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚
🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚
🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚
🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚
🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚🥚
(Score: 2) by Geezer on Friday July 14 2017, @03:41PM
Spokeo partners with Yandex to give us...
Spandex!
(Score: 0) by Anonymous Coward on Saturday July 15 2017, @07:02PM (1 child)
100 million == 59.3 % and 225 million == 36.6 %
What am I missing here? Is it me or Uber who sucks at math?
(Score: 0) by Anonymous Coward on Sunday July 16 2017, @03:29AM
Russia is a lucrative marketplace. One has to pay premium to get in there.