Uber’s messy data breach collides with launch of SoftBank deal
TORONTO/SAN FRANCISCO: A newspaper advertisement for an Uber Technologies Inc stock sale was juxtaposed with a report that the ride- service provider had covered up a data hack – something of a metaphor for Uber, a company with boundless investor interest, but whose penchant for rule-breaking has led to a series of scandals.
The stock sale advertised in the New York Times will enable Uber investors to sell their shares to Japanese investor SoftBank, a critical deal for the company whose problems included building software to spy on competitors and to evade regulators and being investigated in Asia for paying bribes.
Uber on Tuesday said that it had paid hackers US$100,000 to destroy data on more than 57 million customers and drivers that was stolen from the company – and decided under the previous CEO Travis Kalanick not to report the matter to victims or authorities. Uber was first hacked in October 2016 and discovered the data breach the following month.
Chi ef exe cut ive Da r a Khosrowshahi, who took the helm in August with the mission of turning around the company and overhauling its culture, acknowledged in a blog that Uber had erred in its handling of the breach.
The timing of the disclosure could hardly have been worse.
The company is trying to complete a deal with SoftBank Group Corp in which the Japanese firm would invest as much as US$10 billion for at least 14 per cent of the company, mostly by buying out existing shareholders. SoftBank is advertising to find shareholders who want to sell.
Uber last month announced a prel iminary deal for the SoftBank i n v e s t me n t . — Reuters