On August 30, 2021, Yandex N.V. entered into a Framework Agreement (the “Framework Agreement”) with Uber Technologies, Inc., and its affiliates, pursuant to which, among other things, the parties have agreed to restructure their mobility joint ventures, MLU B.V. (“MLU”) and Yandex Self-Driving Group B.V. (“SDG”).
At an initial closing pursuant to the Framework Agreement (the “Initial Closing”), Yandex will acquire from Uber its entire 18.2% equity interest in SDG and an additional 4.5% equity interest in MLU.
In addition, the parties have agreed to spin-off by way of demerger from MLU the Yandex.Eats, Yandex.Lavka and Yandex.Delivery businesses (the “Demerger”). Immediately following the Demerger, Yandex will acquire all of Uber’s equity interest in such businesses (the “Demerger Shares Closing”).
The total consideration payable by Yandex to Uber in respect of the transferred equity interests under the Framework Agreement will be $1 billion in cash, of which (i) $800 million in cash will be paid at the Initial Closing as partial prepayment for the equity interests to be sold at the Demerger Shares Closing and payment for Uber’s equity interests in SDG and MLU, and (ii) $200 million in cash will be paid at the Demerger Shares Closing.
The parties anticipate that the Initial Closing will occur in the third quarter of 2021, and the Demerger Shares Closing will occur late in the fourth quarter of 2021.
In addition, Uber has granted to Yandex an option (the “Call Option”) to acquire Uber’s remaining 29% equity interest in the newly restructured MLU during the two-year period following the Initial Closing, at an initial exercise price of $1.811 billion. Such exercise price will increase in the event that the call option is exercised (i) on or after July 1, 2022 and prior to January 1, 2023, to $1.852 billion, plus interest at a rate of 4.5% per annum from August 1, 2022 through the date of the closing of the Call Option, and (ii) on or after January 1, 2023 and prior to second anniversary of the Initial Closing, $1.93 billion, plus interest at a rate of 6.5% per annum from February 1, 2023 through the date of the closing of the Call Option.
Uber has also agreed to extend, conditioned on the exercise by Yandex of the Call Option, the term of the current trademark license that provides MLU with the exclusive right to use the Uber brand in Russia and certain other countries until August 2030.
The boards of directors of both Uber and Yandex have approved the transactions. The Initial Closing is subject to customary closing conditions. The Demerger Shares Closing is subject to the completion of the Demerger and to other customary closing conditions. The transactions are not subject to the approval of the shareholders of either Uber or Yandex, however, the approval of Yandex’s Class A shareholders may be required for the purchase by Yandex of Uber’s remaining equity interest in MLU pursuant to the Call Option. The transactions are not subject to antitrust or other regulatory approvals.