Softbank gets Uber A-OK for $9 BEEELLION investment cash splurge

13 November, 2017, 19:37 | Author: Oscar Goodwin
  • Uber seals multibillion-dollar investment from Softbank

Under the terms of the deal, it is understood that Softbank will lead a $1 billion funding round with participation of Dragoneer Investment Group, a San Francisco-based investor.

According to a Bloomberg report, the agreement lets SoftBank and other firms invest up to $1 billion in Uber, and proceed with a tender offer in coming weeks to buy up to $9 billion in shares from existing investors.

It is expected to purchase more share from other shareholders as well as from employees, as it plans to acquire 14% share of the cab-hailing company.

Uber Technologies Inc. confirmed the investment in a statement Sunday without giving details. The deal also includes Uber governance changes.

"We believe this agreement is a strong vote of confidence in Uber's long-term potential", it said.

This can bring stability to the world's most valuable startup (valued at almost $70 billion) after the downfall of its founder Travis Kalanick who resigned as CEO in June after allegations of sexual harassment, gender discrimination, and a toxic work environment. Under the deal, the initial public offering will take place before the end of 2019. Both sides ended their feud on Sunday, clearing the way for the SoftBank investment, the person said. Benchmark had alleged that Kalanick duped investors into allowing him to create three disputed board seats that it later wanted to delete, which action would dump Kalanick out of Uber altogether. Benchmark has also agreed to immediately suspend its lawsuit against Kalanick, which it filed in August.

China's Tencent is also reportedly interested in buying a stake in Uber.

Benchmark agreed to drop the lawsuit in return for Kalanick's board power being diluted but its co-operation depends on the Softbank investment going through.

Although Kalanick quit as Uber chief exec, he remains on the board, having previously created the seat he now occupies.

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