Yandex, the "Google of Russia", and Uber have agreed to merge their ride-sharing businesses in Russia and five eastern European markets with Yandex as leading partner, the companies said on Thursday, marking another pullback from Uber's breakneck global expansion that comes a year after its exit from China.
In a joint statement, Yandex and Uber said they will join forces in Russia, Armenia, Azerbaijan, Belarus, Georgia and Kazakhstan to create a new company operating in 127 cities, in a deal expected to close in the fourth quarter.
San Francisco-based Uber has agreed to invest $225 million (roughly Rs. 1,450 crores) while Yandex will invest $100 million into a new joint company in which Yandex will own 59.3 percent, Uber holds 36.6 percent and 4.1 percent by employees on a fully diluted basis.
As part of the deal, Uber will contribute its UberEATS food delivery business in the six-country region to the new venture. Diversified internet giant Yandex is the dominant player in Web search, maps and mobile navigation in the region.
Earlier this week, Uber said it will be improving an offer to drivers and would welcome greater legal clarity about different types of employment in Britain, in response to a government review into the gig economy published on Tuesday.
The review calls for a new category of worker called a "dependent contractor" meaning that those Britons working for companies such as Uber and Deliveroo would receive more benefits.
© Thomson Reuters 2017