The agreement is expected to give SoftBank some 15 percent of Uber's equity, by acquiring shares from early investors -- cutting the estimated value of Uber by 30 percent
Washington (AFP) - Uber and SoftBank announced Thursday they had sealed a deal allowing the Japanese tech titan to take a stake in the US ridesharing giant, believed to be at a huge discount to Uber’s lofty valuation.
The agreement is expected to give SoftBank some 15 percent of Uber’s equity, by acquiring shares from early investors – cutting the estimated value of Uber by 30 percent.
The new investment is part of an effort by Uber to move past a series of scandals and missteps and reform its board structure as it gears up for a 2019 public share offering.
Sources familiar with the deal said SoftBank had reached agreements with investors to reach its target of a 15 percent share.
The two firms did not provide details of the valuation but media reports said the investment was based on Uber’s worth of $48 billion, down from $68 billion earlier this year.
“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,” Uber said in an emailed statement.
A separate statement from Rajeev Misra, chief executive of SoftBank Investment Advisers, said, “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.”
Misra added: “We have tremendous confidence in Uber’s leadership and employees and are excited to support Uber as it continues to reinvent how people and goods are transported around the world.”
New chief executive Dara Khosrowshahi has vowed to fix the company’s work culture and business practices, after taking over earlier this year from ousted founder Travis Kalanick.