Yandex will own 59 percent, Uber roughly 37 percent, and employees the rest.
In China, Uber sold its operations to bigger local rival Didi Chuxing. It's a roaming deal similar to what US ride-hail rival Lyft attempted with China's Didi and other regional competitors.
The deal comes not long after Uber CEO Travis Kalanick, who helped found the app-based vehicle service in 2009, resigned amidst investor pressure. Tigran Khudaverdyan, the chief executive of Yandex.Taxi, will become the CEO of this new venture and Yandex will also be in charge of financial statements.
The transaction is expected to close in the fourth quarter and is subject to regulatory approvals and other conditions.
However, the deal is a reflection of the intense competition that Uber has at times faced in its overseas expansion that can only be described as aggressive. The deal has already been approved by the boards of both companies.
Emil Michael, Uber's former SVP of Business who left the company last month, was also involved in the deal. Under their watch, the company inked an armistice with Didi a year ago, partnerships with automakers Daimler AG and Toyota Motor Corp.
Shares of Russian Internet search giant Yandex (YNDX) jumped 17% in early USA trading after it announced a joint venture with Uber.
Earlier this year, Yandex debuted its self-driving vehicle project for its ride-sharing service. The Uber-Yandex taxi merger deal could hamper competition in the market, Igor Artemyev Head of the Federal Antimonopoly Service (FAS) of Russian Federation told reporters. Once that happens, they plan to integrate their driver apps. It also gives the company access to two new revenue streams: UberEats and any additional revenue from a roaming agreement it struck with Uber as part of the deal.
"FAS did not receive an application from Yandex and Uber on combining businesses in Russian Federation and other countries".