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Gett CEO believes Yandex.Taxi-Uber merger might lead to price hikes

Weiser congratulated Yandex on clinching a good deal

MOSCOW, July 14. /TASS/. Founder and CEO of Gett, Dave Weiser, believes that merger of Yandex.Taxi and Uber businesses might lead to higher prices for online taxi services, he said on his Facebook page.

According to Weiser, "the expected end of the price war between Yandex and Uber will lead to higher prices and a return to more stable margins." He noted that Russia accounts for about 25% of Gett's business.

Previously, Uber stated that the company is not going to change its tariff policy after the merger deal is closed. Yandex did not forecast any radical changes in tariffs now or in the future either.

Weiser congratulated Yandex on clinching a good deal. "For Gett, this means that now there is one less competitor," he said, explaining that now Gett would become the only alternative for drivers. According to Weiser, in the long run, "all drivers will have both applications."

Yandex.Taxi and Uber announced earlier that the companies agreed to merge their businesses in Russia, Azerbaijan, Armenia, Belarus, Georgia and Kazakhstan.

According to the report from Yandex, both the Yandex.Taxi and Uber apps will operate as before, the driver apps, on the other hand, will be transitioned into a unified platform. "This combined driver platform will significantly increase the number of available cars, reduce passenger wait time, and boost vehicle utilization. Drivers will be able to perform more trips per hour while passengers will continue to enjoy affordable prices," the company said.

The new company will also operate the UberEATS service in the region.

Uber will invest $225 mln and Yandex will invest $100 mln into the joint venture, valuing it at $3.725 bln on a post-money basis. "On a pro forma basis, Yandex will own 59.3% of the merged company, Uber will own 36.6%, and employees will own 4.1%," Yandex said.

Yandex does not rule out the initial public offering (IPO) for the new Yandex.Taxi and Uber and company, Yandex press service told TASS. "We do not rule it out," the press service said.

The transaction is still subject to regulatory approvals and is scheduled to close in the Q4 2017.

The two teams will be integrated together and the current CEO of Yandex.Taxi Tigran Khudaverdyan will serve as the CEO.

Uber Communications Director in Russia and the CIS Irina Gushchina said earlier that Yandex.Taxi and Uber planned to file to a request with the Federal Antimonopoly Service (FAS) on the companies’ business merger in the coming days.

Head of FAS Igor Artemyev said earlier that combining Yandex.Taxi and Uber taxi businesses might present a threat restricting competition in the market. "We have only heard about it today, and I have learned about it three hours ago. We have an idea - we have three main aggregators and if two of them are going to merge, then this is, of course, a threat to the market. A threat to competition, undoubtedly, is present here," Artemyev said.