SoftBank Group Corp. has succeeded in its bid to buy a large stake in Uber Technologies Inc.at a steep discount, after the ride-hailing company's investors and employees tendered shares equal to about 20% of the company, people familiar with the matter said on Thursday.
As part of the deal, expected to close early next year, Uber will offer potential drivers in the United States access to Fair to lease a vehicle, the Journal reported.
The investment is seen as a sign of support from the influential investors for its chief executive, Dara Khosrowshahi, who took the job in August and has helped negotiate the deal. In a recent board agreement, Uber's directors said they expected the company to begin the IPO process by 2019. Uber is losing more than US$1 billion each quarter, and a new cash infusion is critical. SoftBank and the rest of consortium, which includes Dragoneer Investment Group, will own about 17.5%, including a secondary share purchase from earlier investors and employees, as well as $1.25bn of fresh funding.
The tender offer valued Uber at about 30% less than the $69 billion it was pegged at in June 2016, after the company sold a chunk of shares to Saudi Arabia's Public Investment Fund for $3.5 billion.
Sources say SoftBank will likely limit its acquisition to 15 percent at a $48 billion valuation.
First Pakistan-China-Afghanistan foreign ministers' moot in Beijing today
The three countries agreed to establish the mechanism during Wang's visit to Kabul and Islamabad in June. The three officials discussed ways to encourage economic and security cooperation.
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. However some Uber investors were concerned the price SoftBank was offering was too low, according to Recode.
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.
Over the past year, a former employee's charges of endemic sexual harassment led to an internal review, the mayor of London said he would strip Uber of its licence and Uber revealed it had covered up a major hack.