Russian-based Yandex may drop plans for having an initial public offering (IPO) of stock for its ride-hailing business, which it owns with Uber Technologies, Inc..
Bloomberg reports that Yandex may, instead, buy out Uber. Such a move would come in the middle of the economic tsunami that has rocked the ridesharing market — with Uber and Lyft shares down, making an IPO less attractive.
In April, Uber lowered its 2020 guidance as the pandemic upended the business, as reported by PYMNTS. “Given the evolving nature of COVID-19 and the uncertainty it has caused for every industry in every part of the world, it is impossible to predict with precision the pandemic’s cumulative impact on our future financial results,” Uber said in a statement at the time.
Besides Yandex, Uber also owns minority stakes in Didi, Grab and Zomato.
With the changed economic environment, Yandex, sometimes called the “Google of Russia,” may be looking to combine its carsharing business with its ride-hailing venture with Uber.
Sources told Bloomberg that Yandex wants to buy all of Uber’s 38 percent stake in the joint business, which the ride-hailing giant valued at $1.24 billion as of March 31. Uber said that, after February 2021, any transfer of its stake is subject to a right of first refusal by Yandex.
However, nothing may come of the deliberations by Yandex, which could still pursue an IPO.
Yandex, which makes money off of web advertising, set up its ride-hailing service in 2011. In a February 2018 deal that valued the business unit at $3.8 billion, Uber merged its operations in Russia and neighboring countries with Yandex.
Since then, Yandex.Taxi has moved into various lines of operation, including food delivery, grocery delivery — even self-driving cars.
Overall, before the COVID-19 crisis, Yandex had been on the move. In January, the Russian technology giant said it planned to expand its car-sharing offerings into Europe — even as other companies in the business were retreating. As reported by PYMNTS, the company said it was the largest car-sharing organization in the world, with 21,000 cars in Russia.
