SoftBank eyes Uber shares at 30% discount
SANFRANCISCO: Japan’s SoftBank Group Corp is offering to purchase shares of Uber Technologies Inc at a valuation of $48 billion, a 30% discount to its most recent valuation of $68.5 billion, a person familiar with the matter said on Monday.
The investment, which was approved by the Uber board in October, would also trigger a string of governance changes at Uber that would limit some early shareholders’ voting power, expand the board from 11 to 17 directors and cut the influence of former CEO Travis Kalanick.
The investment and board moves are supported by new CEO Dara Khosrowshahi and come at the end of a year of scandals and change for Uber, including the announcement last week that executives covered up a major hack in 2016.
The consortium of investors led by SoftBank and Dragoneer Investment Group plan to take a stake of at least 14% in the ride-services company.
The tender offer will launch on Tuesday, sources told Reuters, and investors have nearly a month to respond.
If there are not enough interested sellers, SoftBank can still walk away from the deal. SoftBank is also expected to make a separate $1 billion investment in Uber at the $68.5 billion valuation.
SoftBank’s offer is close to what Uber was worth in 2015, when shares were priced a little less than $40 apiece for a $51 billion valuation, according to data from PitchBook Inc.
Even at the discounted price, Uber is the world’s second-highest valued private venture-backed company, after China’s ride-service company Didi Chuxing, and the offer is a chance for early investors to lock in substantial profits and for employees to cash in shares that have to date only had value on paper. Shareholders, including employees, with at least 10,000 shares are eligible to sell.