SoftBank agrees to buy big stake in ride-hailing firm Uber

Dec 29, 2017, 5:00 am

Aniruddha P.

More Post

Yesterday, SoftBank and Uber agreed upon a ‘long-awaited tender offer’ with a valuation of $48 billion in the latter. The deal will unite one of the most valuable startups and one of the most ambitious tech investment firms in the world.

This amount is about 30% discount to Uber’s $68 billion valuations from June 2016. That’s not all as according to a source, SoftBank will further invest $1.25 billion at Uber’s previous valuation of the same amount.

An excerpt from Uber’s statement: “We look forward to working with the purchasers to close the overall transaction, which we expect to support our technology investments, fuel our growth, and strengthen our corporate governance.”

The transaction was previously reported by Wall Street Journal, and they predict that SoftBank would buy 15% of Uber and that an additional 5% of the latter would be made available to other bidders. Uber did not confirm on this and said that the shareholding target was reached by its consortium.

Related:

[mnky_related_posts num=”2″]

As per a statement by SoftBank, the deal is to close by January 2018. They expressed their confidence in the transport tech company regarding its innovative contributions to its own field. Although, Uber hasn’t been having a smooth run this year with scandals leading to co-founder Travis Kalanick leaving his CEO role, along with data breach and lawsuits. This all naturally led the company to agree upon the reduced deal.

Uber revealed its target of 2019 IPO even though it loses billions of dollars per 4 months. SoftBank’s investments are certainly to make way for the accomplishment. SoftBank, on the other hand, seems to have its hands full with obligations to provide liquidity to employees and investors alongside its stock in Uber.

[easy-subscribe design=”design3″]

At the same time, SoftBank gets to soften its way to expand on the ride-hailing profile that’s growing gradually. It invests in Didi Chuxing of China, Uber rival Ola of India and Grab from Southeast Asia.

An interesting connection between SoftBank and Uber is that Dara Khosrowshahi (who replaced Kalanick as Uber’s CEO) is a board member of Fanatics that are also backed by SoftBank. Khosrowshahi is so far known to be dedicated to improving Uber’s status in the market since he took office in October.

Via: CNBC

Brand Partnership
Your brand needs a brand voice. Contact our marketing team for brand partnership with us.
Talk to Us
Join our Newsletter
Sign up to receive top tech stories daily delivered in your inbox
Share your thoughts. Enable the box to comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.