Buffett kicked tires on Uber deal: sources

Warren Buffett proposed investing $3 billion in Uber earlier this year, but the talks fell apart following disagreements over the terms and size of the deal, people familiar with the matter said.

The now-dead Uber transaction is reminiscent of the winning bet Buffett’s Berkshire Hathaway made on Goldman Sachs during the financial crisis.

Buffett invested $5 billion in Gold- man Sachs, lending his imprimatur to the bank when it was reeling after the collapse of rival Lehman Brothers in late 2008.

In exchange, Buffett’s company got preferred stock that ultimately netted Berkshire more than $1.6 billion in profit. Berkshire also got warrants to buy Goldman stock that produced an even bigger gain.

Buffett proposed similar terms to Uber in the wake of a crisis of the ridehailing company’s own making. Buffett would have effectively lent Uber his sterling reputation, along with some cash, in exchange for cushy deal terms.

A spokesman for Uber declined to comment. Buffett did not immediately respond to a request for comment.

Under the proposed agreement, Berkshire Hathaway would have provided a convertible loan to Uber that would have protected Buffett’s investment should Uber hit financial straits, while providing significant upside if Uber continued to grow in value, said the people, who spoke under condition of anonymity.

Buffett’s initial offer was well above $3 billion, one of the people said.

During negotiations Uber Chief Executive Dara Khosrowshahi proposed decreasing the size of the deal to $2 billion, one person said, hoping to get Buffett’s backing while giving him a potentially smaller share of the company.

The deal fell apart after the two sides couldn’t agree on terms, one of the people said.