Uber seems to have a tendency to “shed” in summer. Last year in August, the company sold Uber China to its biggest competitor Didi Chuxing. This summer it merged its Russian operations with Yandex.Taxi, the local leader in ride-hailing and a subsidiary of Russian Google-like search giant Yandex.
According to a recent Yandex press release, the merger came at the grand cost of $3.7 billion. Yonder owning 59.3% and Uber 36.6%, with the remaining 4.1% held by employees. Current Yandex.Taxi CEO Tigran Khudaverdyan will serve as chief executive of the combined businesses, which will also be overseen by a board with four directors nominated by Yandex and three by Uber.
The deal marks the second time Uber has ceded a major market to a competitor. The sale to Didi Chuxing brought an sudden end to a battle for ride-hailing dominance in China that had cost Uber a reported $1 billion a year.
According to Forbes, the Chinese ride-hailing market should be worth as much as $73 billion by 2020. Didi invested $1 billion into Uber (last valued at nearly $70 billion) and Uber received a 17.7% stake in Didi in that deal, which valued the combined China operations at $35 billion.
As part of the merger with Yandex, Uber has agreed to invest $225 million into the newly formed company and Yandex to invest $100 million. The two companies said they completed a combined 35 million rides in Russia and five other countries in June for $130 million in gross bookings. They are projecting an annual run rate of 419 million rides and $1.6 billion in gross bookings based off those figures, with Yandex’s share roughly double Uber’s.