Uber Cedes Russia to Yandex with $3.7B Merger Agreement • Hacker News Board

Re: Uber Cedes Russia to Yandex with $3.7B Merger Agreement

#41

Post by techinformed56 » Thu, Jul 13, 2017, 7:49 PM UTC

calafrax wrote: post #34

techinformed56 wrote: post #33

Earlier quoted context omitted.

If you read other articles you can see that Uber spent 170M in Russia till now. Along with this 225M its a total 395M of spending. And now they got 36.6% stake in a company (now a leader in Russia) worth 3.4B. So Uber got 1.4B. How is that not coming out with anything? Uber did same thing in China. While we all think they lost in China, Uber seems to have spent around 2B or so but got away with close to 8B stake in D…

They own a minority stake in an entity that has to pay Yandex for infrastructure, licensing rights and advertising which Yandex controls. So this entity racks up a lot of debt (to Yandex) while making transfer payments to Yandex and then in a few years: "whoops, bankrupt!" Now the equity holders (Uber) get wiped out and the company re-organizes and sells its assets (to Yandex) to pay off its debts (to Yandex) and Ube…

Yandex.taxi is a service provided by Yandex. The deal talks nothing about licesing agreement for Yandex infrastructure (maps etc). So the claim you make above is under premise that ride sharing will not make money at all and money spend on infrastructure will be far more than what ride hailing can generate. So if this assumption is wrong then we are in different argument on whether ride hailing is a sustainable business at all. Every investor is investing hoping ride hailing will be a profitable business. If it is then this combined entity has more to gain than lose.

Re: Uber Cedes Russia to Yandex with $3.7B Merger Agreement

#42

Post by throwaway34321 » Thu, Jul 13, 2017, 8:34 PM UTC

eps wrote: post #16

adventured wrote: post #11

Earlier quoted context omitted.

It's a moot issue. There was no scenario under which a Western firm was going to be allowed to dominate any meaningful Russian infrastructure long-term. Uber is fortunate if they come away from Russia with anything. In most industries Putin is reluctant to allow even his own oligarchs outright control. The notion he'd allow Uber to own their taxi / ride-hailing business is laughable (even assuming Uber could compete…

Uber never dominated in Russia. I talked to Moscow taxi drivers on more than one occassion and they were dismissive of Uber as an older and inferior iteration of what Yandex.Taxi was doing. Uber was never at the top, but at a fairly distant second, so their minority-shareholder "merge" with YT is of no surprise.

> fairly distant second

Gross bookings approximately half that of Yandex and more cities than Yandex doesn't sound like a fairly distant second especially since Uber arrived well after Yandex. Uber was doing better against Yandex than Lyft is doing against Uber. Approximately a 40% stake in the new venture and 3 of the 7 board seats appears to be a testament to Uber's relative strength against Yandex.

Re: Uber Cedes Russia to Yandex with $3.7B Merger Agreement

#43

Post by sushid » Thu, Jul 13, 2017, 9:07 PM UTC

COMMENT___ wrote: post #40

Grue3 wrote: post #38

Earlier quoted context omitted.

For example I had a case where a driver did not finish the ride when I got out of the car and did so 30 minutes later in some random location, and I got a huge bill. I also had a driver refuse me to drive me to the destination in the middle of a ride, I also refunded that. Not that Uber drivers don't do shit like this, but I found them more professional. Now that the two companies merged, it's gonna be the worst case…

Oh, now I get it. However, aren't you forgetting that a lot of Uber drivers in Russia were or are still driving with Yandex Taxi and Uber concurrently? Uber does not really do anything special to ensure this professionalism in Russia except a brief screening, AFAIK. That's why I don't think that anything will change from rider's perspective.

I think OP is agreeing with you. The drivers were not better quality, per se, but Uber's customer service was.

Re: Uber Cedes Russia to Yandex with $3.7B Merger Agreement

#44

Post by calafrax » Thu, Jul 13, 2017, 10:18 PM UTC

techinformed56 wrote: post #41

calafrax wrote: post #34

Earlier quoted context omitted.

They own a minority stake in an entity that has to pay Yandex for infrastructure, licensing rights and advertising which Yandex controls. So this entity racks up a lot of debt (to Yandex) while making transfer payments to Yandex and then in a few years: "whoops, bankrupt!" Now the equity holders (Uber) get wiped out and the company re-organizes and sells its assets (to Yandex) to pay off its debts (to Yandex) and Ube…

Yandex.taxi is a service provided by Yandex. The deal talks nothing about licesing agreement for Yandex infrastructure (maps etc). So the claim you make above is under premise that ride sharing will not make money at all and money spend on infrastructure will be far more than what ride hailing can generate. So if this assumption is wrong then we are in different argument on whether ride hailing is a sustainable busin…

I am not saying that the business is not profitable. I am just saying that Yandex is going to take it all.

If Yandex can take Uber's stake, which is worth billions as you say, they would be stupid not to, and they can, so they will.

Re: Uber Cedes Russia to Yandex with $3.7B Merger Agreement

#45

Post by Grue3 » Fri, Jul 14, 2017, 6:01 AM UTC

COMMENT___ wrote: post #40

Grue3 wrote: post #38

Earlier quoted context omitted.

For example I had a case where a driver did not finish the ride when I got out of the car and did so 30 minutes later in some random location, and I got a huge bill. I also had a driver refuse me to drive me to the destination in the middle of a ride, I also refunded that. Not that Uber drivers don't do shit like this, but I found them more professional. Now that the two companies merged, it's gonna be the worst case…

Oh, now I get it. However, aren't you forgetting that a lot of Uber drivers in Russia were or are still driving with Yandex Taxi and Uber concurrently? Uber does not really do anything special to ensure this professionalism in Russia except a brief screening, AFAIK. That's why I don't think that anything will change from rider's perspective.

In Moscow none of Yandex.Taxi drivers drive their own car. They drive a yellow Yandex.Taxi car with standartized livery. A lot of them have zero knowledge of the streets. I took a ride to the airport once and the driver didn't know how to use the toll road. I (who never owned a car in my life) had to explain how to use the damn thing. This is the quality of drivers we're dealing with here.