On Thursday, Softbank Group Corp. led by a group of investors closed a deal with Uber Technologies Inc, making them the largest stakeholder in the ride-services firm and also to boost Uber from controversies.
An Uber spokesman said, the deal includes a large purchase of shares from other Uber investors and employees at a very discounted price. A 30 percent price drop from $68 billion to $48 billion. These secondary stock sales will be completed by the end of the day Thursday on the Nasdaq Private Market.
The investor group, which is co-led by Softbank and Dragoneer Investment Group and also included Sequoia Capital completed a $1.25 billion investment of fresh cash at the other, higher evaluation, added by the spokesman.
Softbank will have a 15 percent-share while the other investors summed up will only have 17.5 percent making the Softbank as the company’s largest shareholder. This will also result to the adding of new board members that must take effect immediately.
“This is a great outcome for our shareholders, employees and customers, strengthening Uber’s governance as we double down our technology investment and continue to bring our services to more people in more places around the world,” said by the Uber spokesman.
The closing of the deal gave them a closure of their months-long process fraught with infighting among board members.
Uber has been under controversies for some time now. From the lawsuit case for the co-founder and former CEO Travis Kalanick to remove him from the board by a new but large investor, the Benchmark Capital to the controversies including the federal criminal probes, a massive data breach and a lawsuit claiming trade secrets theft.
The board first voted to move on with the Softbank investment last October but it seemed to have a problem but last month, Uber announced to move forward because some stock holders gave way and sell their shares to Softbank.
The deal comprises of the expansion of Uber’s board members, from 11 to 17 with four independent directors that may limit some to have a voting power.
Also, the Benchmark agreed to stop the lawsuit against Kalanick upon the completion of the deal.
This big news gave Uber a positive and fresh start to 2018.
