In a statement today, Uber announced that it would take a leap with a preferred investment from one of Japanese tech giant “SoftBank” that is expected to shut down in the coming weeks, and which is also been voted in favour of quite a number of governance reforms.
Last week Travis Kalanick stepped aside from Uber as the CEO. Is it so that the Uber IPO is one step closer now after this development?
The decision augurs poorly for the founder of Uber, Travis Kalanick, who has achieved to conserve his influence over the company after he stepped back as Uber’s CEO in June. He could cover the way for greater changes in International operations of Uber.
In August, SoftBank stated that it’s interested in making an investment with Uber. The proposed amount of its investment hasn’t been made public, although an individual having the knowledge of this deal said that; SoftBank will invest $1.25 billion along with other investors directly in Uber at a valuation of $69 billion. And from the existing investors it will also be purchasing 14% to 17% shares that are outstanding. This person also said that by 2019 Uber will go public that’s something which the Uber CEO gave a slight hint of in August.
As per this individual, these changes in the governance will expand the board of Uber from 11 to 17 seats, along with two reserved spots for representatives from the SoftBank. More significantly, the board concurred to strip the rights of “super voting” of some investors that were holding multiple votes per share. It came with a new “one vote”, “one share” for the investors. Kalanick along with many other previous employees maintained outsized rights for voting as compared to the number of owned shares, and he also controlled three seats of the board.
This investment by SoftBank is more than just money deal-It’s a conveyance of moving Kalanick away.