Uber and Yandex, the 'Google of Russia', have agreed to combine their Russian ride-sharing businesses. The move further heralds the slowdown of Uber's global expansion, while it bolsters Yandex's position in its field: the company has invested $100 million into the venture compared to Uber's $225 million, but will own 59.3 percent. Yandex.Taxi chief executive Tigran Khudaverdyan will become the CEO of the combined business.
Both companies will work together to provide ride-hailing and food delivery services in Russia, Armenia, Azerbaijan, Belarus, Georgia and Kazakhstan. Customers can complete their transactions using either the Uber or Yandex app, while driver apps are set to be integrated once the merger is complete at the end of the year.
The deal seems to benefit both parties. Yandex is eliminating a potentially aggressive competitor, while Uber gets the support it needs to continue its operations in Russia following months of legal setbacks and driver protests. However, the San Francisco company struck a similar deal with rival Didi Chuxing in China last year, only to withdraw from the country completely a few months later. Plus the new company is up against fierce competition from the likes of Fasten/Rutaxi, Maxim and Gett, the Israeli startup backed by German automaker Volkswagen. But with Yandex and Uber together performing over 35 million rides a month while growing over 400% year-over-year, the proposed unison does seem strong enough to keep Uber on Russian roads for now.