Japan’s SoftBank Group Corp has offered to purchase shares of Uber Technologies Inc at a 30 percent discount to its most recent valuation of $68.5 billion, according to sources. Uber is the world’s second-highest valued private venture-backed company. The deal, approved by Uber’s board in October, would cause some restructuring at Uber such as limiting early shareholders’ voting power, expanding the board from 11 to 17 directors and remove any authority from former Chief Executive Travis Kalanick.
The deal is supported by new Chief Executive Dara Khosrowshahi. The group of investors led by SoftBank and Dragoneer Investment Group intend to take a 14 percent stake in the company. The SoftBank-led investor group will gain two of the new board seats, with the remaining four left for independent directors. If there are not enough interested sellers, SoftBank is able to walk away from the deal and is also expected to make a separate $1 billion investment into Uber it’s $68.5 billion valuation.
At the discounted price, Softbank’s offer is a chance for early investors to generate substantial profits and for employees to be able to sell shares. Shareholders, including employees, with at least 10,000 shares are eligible to sell.
Since valued at $68.5 billion over a year ago, Uber has been hit by scandals, endured federal criminal investigations into software Uber used to deceive regulators, accused of paying bribes to Asian authorities, as well as a lawsuit by Alphabet Inc’s self-driving unit Waymo.
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Recently, Uber disclosed that the data of 57 million Uber customers and 600,000 drivers had been stolen in a breach over a year ago and two hackers were paid $100,000 by the company to cover it up. Uber stated that SoftBank was aware of the data breach prior to informing the public. SoftBank has already factored any negative effects from the breach into its negotiations with Uber, according to sources.