SoftBank Acquires Big Stake In Uber In a Major Victory For Both Companies (recode.net) 17
According to Recode, "Softbank and its co-investors have successfully acquired at least 13 percent of Uber, a major victory for Uber's new CEO and one that will give billions of dollars in cash to some of the company's earliest investors and employees." Recode highlights the far-reaching consequences:
Uber's board of directors, which had devolved into a power struggle between Uber's former CEO, Travis Kalanick, and its largest investor, Benchmark, will now likely be calmer. Benchmark is expected to drop its lawsuit against him. And Uber will enact governance reforms that disempower the two warring factions and increase the size of the board to a massive 17 people.
A lot of people are now very rich. While we have yet to learn which investors have cashed out for the price of about $33 a share, Thursday's result is the reward for years of drama at a company that nevertheless saw astronomical growth since its founding in 2009. Uber's earliest employees who sold are now millionaires, and venture firms could see billions of dollars flow into their bank accounts.
Uber now has a powerful strategic partner in SoftBank, the Japanese telecom giant that is investing hundreds of billions of dollars in technology. SoftBank, which is heavily invested in other ride-hailing companies around the globe, could help Uber strike more partnership deals, especially in Asia. SoftBank will occupy two seats on the company's board and will now be an extremely influential player in decisions at Uber.
The deal nevertheless sharply discounts Uber's value, which last year was estimated at almost $70 billion. SoftBank and its co-investors are acquiring some of the company at a valuation of $48 billion. While a 30 percent discount is not unusual in a transaction like this, it does reflect some concerns about how the company can move forward after a year of upheavel that has not totally abated.
A lot of people are now very rich. While we have yet to learn which investors have cashed out for the price of about $33 a share, Thursday's result is the reward for years of drama at a company that nevertheless saw astronomical growth since its founding in 2009. Uber's earliest employees who sold are now millionaires, and venture firms could see billions of dollars flow into their bank accounts.
Uber now has a powerful strategic partner in SoftBank, the Japanese telecom giant that is investing hundreds of billions of dollars in technology. SoftBank, which is heavily invested in other ride-hailing companies around the globe, could help Uber strike more partnership deals, especially in Asia. SoftBank will occupy two seats on the company's board and will now be an extremely influential player in decisions at Uber.
The deal nevertheless sharply discounts Uber's value, which last year was estimated at almost $70 billion. SoftBank and its co-investors are acquiring some of the company at a valuation of $48 billion. While a 30 percent discount is not unusual in a transaction like this, it does reflect some concerns about how the company can move forward after a year of upheavel that has not totally abated.
A major victory? (Score:4, Funny)
Major victory my arse. Softbank? Soft in the bloody head more like.
Softbank own ARM Holdings too (Score:2)
$32 Billion to own ARM? Not a bad deal at all.
https://www.wsj.com/articles/s... [wsj.com]
SoftBank has been buying shares left and right (Score:3)
Time to party like its 1985 ! (Score:2, Interesting)
Reminds me of the 80's when the Japanese bought up billions of dollars of over-priced US real estate. The US market slumped after the S&L scam fell apart, and the Japanese investors lost billions, sparking a global recession. Looks like the same thing again, just on a larger scale. Their will be a tech bubble inevitable, and the house of cards will fall again. Time to party like its 1985 !
Still Victorian, however (Score:1)
Uber is just another one in a loooong line of companies trying to recreate the Victorian age of zero-workers' rights and shoddy practises to drive competitors out of business and then charge monopoly rates. Oh,yeah, they use mobile phones so that makes it "innovative". Go away.
Disproving the old saw (Score:2)
And people say that crime doesn't pay.
Re: (Score:2)
Yeah, Uber should get government to enshrine their business model into law like the taxi companies and the labor unions did.
Hey! Maybe they can use some of that SB money to buy back some of those politicians to pass laws to make Uber the only legal ride service!
Ain't cronyism grand? It's a game anyone* can play!
Even better, the larger government grows, the more and the more-juicy the opportunities bec
Softcom Also Owns Sprint.... (Score:2)
So from now on, will you get a discount on an Uber ride if you make it with a Sprint phone?
I Come to Slashdot for Nerd News (Score:1)
Not taxi advertisements.
SB hedging (Score:1)