As part of the deal, Vezyot’s current shareholders will receive new shares in MLU, representing up to 3.6 percent of the company at closing, along with up to $71.5 million in cash depending on certain operating and integration milestones. Once the acquisition is complete, Yandex will own 56.2 percent of MLU, while Uber will own 35 percent, and approximately 5.3 percent will be held by employees under the MLU equity incentive plan.
MLU also plans to invest around 8 billion rubles in the Russian regions over the next three years. Half of the investment will focus on developing the safety and security of services, with the other half will support regional drivers and taxi fleet companies.
The deal means that consumers will be able to order a taxi via Rutaxi and Vezyot mobile apps, as well as the Vezyot call center. In addition, driver-side apps will be integrated into a single platform so that passengers experience shorter wait times and drivers enjoy increased utilization rates. MLU and Vezyot will also continue to invest in driver training and support centers, driver loyalty programs and other services.
Yandex already holds 56 percent of the Moscow taxi market, while its chief rival Citymobil recently doubled its share to 24 percent. Mail.ru and mobile operator Megafon jointly control 51 percent of Citymobil. Mail.ru has contested the Yandex deal, explaining that the announcement was “premature” and required its consent under terms of a $15 million convertible loan it gave Vezyot last year, which allegedly gives Mail.ru the right to veto “divestment of Vezyot’s key assets,” according to Financial Times.
But Vezyot said the deal did not violate its commitments to Mail.ru because it hasn’t converted its loan into shares.
The companies expect to close the deal by the end of 2019, which is subject to approval by the Russian Federal Antimonopoly Service.