Yandex, the leading Russia-based internet services provider, has reportedly spun out its self-driving car unit from its food delivery & ride-hailing joint venture partnership with Uber, called MLU BV. The latest move comes on the heels of earlier reports that Uber and Yandex were looking forward to an IPO (initial public offering) for MLU last year. According to industry experts, by spinning out the new unit, Yandex will be able to double down on the economics, as well as the cost base of the MLU unit, and focus more on its investments in self-driving.
A Yandex spokesperson recently stated, “Yandex’s motivation behind the spin-off is twofold. From the business standpoint, we are increasing our stake in a strategically important business with lots of potential for growth. From the technology standpoint, self-driving technology is quickly moving forward to become a viable business. We believe that Yandex. Taxi can get a lot more from its synergies with other Yandex businesses.” Yandex is reportedly investing around USD 150 million in the spin-out self-driving car business. The total investment comprises USD 100 million in equity and USD 50 million as a convertible loan. The company said it had invested up to USD 65 million in the business by far. In this process, the company is acquiring some shares of Uber, and it will now hold a 73% stake in the new spun-out business, while Uber is likely to own around 19%. The remaining 8% is expected to be held by the self-driving group (SDG) management and employees of Yandex.
Yandex Co-founder & CEO Arkady Volozh was recently reported saying, “We firmly believe in the future of autonomous mobility as a safe and cost-effective form of transportation with a vast addressable market. The additional capital that we are investing in SDG will allow it to continue to pursue the R&D and productization of autonomous mobility.”