SoftBank reportedly buys major stake in Uber at a big discount

by Frankie Norman December 29, 2017, 1:49
SoftBank reportedly buys major stake in Uber at a big discount

That is a roughly 30% discount to its most recent valuation of almost $70 billion.

As part of the deal, Uber's board will expand from 11 to 17 directors, with Softbank's investor group taking two of the new seats. That stake includes a share purchase from earlier investors and employees at the US$48 billion valuation, as well as a US$1.25 billion investment of fresh funding at the US$68 billion level. But SoftBank CEO Masayoshi Son had repeatedly teased the possibility - some might say threat - of investing in Lyft instead, including as recently as last month.

Softbank led a consortium that reportedly agreed to invest at least $8bn for a roughly 15% stake in the San Francisco-based ride-hailing company.

The investor group is also buying about $1.25bn worth of new shares at a price that values the firm at nearly $70bn, a significantly higher price that is similar to what Uber shares fetched in its last fundraising round.

Getting the company ready to go public will be Khosrowshahi's ultimate goal over the next year, though it won't be easy.

SoftBank founder Masayoshi Son has taken a keen interest in ride-hailing companies around the world
SoftBank founder Masayoshi Son has taken a keen interest in ride-hailing companies around the world

We are appreciative of the support from Uber's shareholders in the successful tender offer and look forward to closing the overall investment in January.

Uber's corporate governance, set to be overhauled as part of the SoftBank deal, became a hot-button issue this year after the company saw a seemingly never ending string of crises and experienced the resignation of its cofounder and CEO Travis Kalanick.

"The stockholders did the smart thing". SoftBank will get two seats on the expanded board, a source told Reuters. Misra said SoftBank had "tremendous confidence in Uber's leadership and employees". The closing of the deal will also mark the end of the company's supervoting share structure, moving the company to a "one share, one vote" system that further weakens the influence of early executives and shareholders. However some Uber investors were concerned the price SoftBank was offering was too low, according to Recode.

SoftBank has previously pumped billions into several ride-hailing companies overseas, including Didi in China, Grab in Southeast Asia and 99 in Brazil.


TOP News

Julian Assange's Twitter account is back, but the mystery remains

Lorde Cancels Israeli Show

Mohamed Salah makes ominous prediction about his Liverpool FC form

Apple admits to slowing down older iPhones

JeM commander Noor Muhammed killed in encounter

Barack Obama, Hillary Clinton remain most admired in the US

UN Security Council Unanimously Votes to Impose New Sanctions on North Korea

$1200 gold coin dropped in Salvation Army red kettle

Jai Ram Thakur will be new CM of Himachal Pradesh

WH Denies NYT Report Claiming Trump Said Haitian Immigrants 'All Have AIDS'