SoftBank Succeeds in Tender Offer for Large Stake in Uber
Uber shareholders tendered about 20% of company to SoftBank, sources say
The Softbank tender offer is critical to Uber because a series of hard-fought corporate reforms are tied to its completion. PHOTO: SIMON DAWSON/REUTERS
SoftBank Group Corp. has succeeded in its bid to buy a large stake in Uber Technologies Inc. at a steep discount, after the ride-hailing company’s investors and employees tendered shares equal to about 20% of the company, people familiar with the matter said on Thursday.
SoftBank will likely limit the stake it acquires to 15% in the tender offer, which values Uber at $48 billion, the people said. That is a roughly 30% discount to its most recent valuation of nearly $70 billion. Other members of SoftBank’s bidding group are likely to buy part of the remaining shares on offer, the people said.
The tender offer—an open call to buy shares in the privately held company—expires Thursday at noon Pacific time, meaning investors could still change their minds, potentially affecting the final tally of shares available.
A successful deal is critical to Uber because a series of hard-fought corporate reforms are tied to its completion. The ride-hailing firm will be transformed by adding six directors—including two from SoftBank—and expanding voting rights for all investors. For SoftBank, the deal is a high-stakes bet on the future of transportation, as the Japanese investor already owns big stakes in several of Uber’s competitors around the globe.
As part of the deal, SoftBank also will invest at least $1 billion into Uber at the most recent valuation of nearly $70 billion, a concession to existing Uber shareholders concerned that the purchase of lower-price shares in the tender offer will undermine the value of their remaining stakes. SoftBank is leading a consortium in the investment that also includes Dragoneer Investment Group and Tencent Holdings Ltd. Some potential investors, like General Atlantic, dropped out over disagreement about the price being offered stakeholders.
SoftBank is set to appoint to Uber’s board Rajeev Misra, who helms the $93 billion Vision Fund that SoftBank is tapping for the deal, people familiar with the matter said. It also is likely to appoint Marcelo Claure, the chief executive of Sprint Corp.,though SoftBank Vice Chairman Ron Fisher also has been under consideration, these people said. All three men are directors at SoftBank, meaning whichever two are chosen, the Uber and SoftBank boards would share three directors in common, as Yasir Al Rumayyan, the managing director of Saudi Arabia’s Public Investment Fund, already is on both boards.
The Softbank tender offer is critical to Uber because a series of hard-fought corporate reforms are tied to its completion. PHOTO: SIMON DAWSON/REUTERS
SoftBank Group Corp. has succeeded in its bid to buy a large stake in Uber Technologies Inc. at a steep discount, after the ride-hailing company’s investors and employees tendered shares equal to about 20% of the company, people familiar with the matter said on Thursday.
SoftBank will likely limit the stake it acquires to 15% in the tender offer, which values Uber at $48 billion, the people said. That is a roughly 30% discount to its most recent valuation of nearly $70 billion. Other members of SoftBank’s bidding group are likely to buy part of the remaining shares on offer, the people said.
The tender offer—an open call to buy shares in the privately held company—expires Thursday at noon Pacific time, meaning investors could still change their minds, potentially affecting the final tally of shares available.
A successful deal is critical to Uber because a series of hard-fought corporate reforms are tied to its completion. The ride-hailing firm will be transformed by adding six directors—including two from SoftBank—and expanding voting rights for all investors. For SoftBank, the deal is a high-stakes bet on the future of transportation, as the Japanese investor already owns big stakes in several of Uber’s competitors around the globe.
As part of the deal, SoftBank also will invest at least $1 billion into Uber at the most recent valuation of nearly $70 billion, a concession to existing Uber shareholders concerned that the purchase of lower-price shares in the tender offer will undermine the value of their remaining stakes. SoftBank is leading a consortium in the investment that also includes Dragoneer Investment Group and Tencent Holdings Ltd. Some potential investors, like General Atlantic, dropped out over disagreement about the price being offered stakeholders.
SoftBank is set to appoint to Uber’s board Rajeev Misra, who helms the $93 billion Vision Fund that SoftBank is tapping for the deal, people familiar with the matter said. It also is likely to appoint Marcelo Claure, the chief executive of Sprint Corp.,though SoftBank Vice Chairman Ron Fisher also has been under consideration, these people said. All three men are directors at SoftBank, meaning whichever two are chosen, the Uber and SoftBank boards would share three directors in common, as Yasir Al Rumayyan, the managing director of Saudi Arabia’s Public Investment Fund, already is on both boards.
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