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Uber approves SoftBank multibillion investment offer

Uber approves SoftBank multibillion investment offer
© Greg Nash

Uber has approved Japanese technology conglomerate SoftBank’s bid to purchase a multibillion dollar stake in the ride-hailing company.

The Japanese internet and telecommunications firm’s investment in Uber is set to be one of the largest-ever deals with a private startup.

The deal will allow Softbank, along with other firms, to purchase $1 billion in Uber. After this, firms will be able to purchase up to $9 billion in equity from Uber’s shareholders, according to Bloomberg. The final amount will be contingent on the willingness of current shareholders to fork over their holdings to SoftBank.

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“We’ve entered into an agreement with a consortium led by SoftBank and Dragoneer on a potential investment," Uber said in a statement provided to the publication. "We believe this agreement is a strong vote of confidence in Uber’s long-term potential. Upon closing, it will help fuel our investments in technology and our continued expansion at home and abroad, while strengthening our corporate governance.”

The deal, which sources tell Bloomberg was reached on Saturday, was reportedly the result of weeks-long negotiations between SoftBank and Uber.

Per the conditions negotiated, major Uber investor Benchmark Capital has agreed to put a hold on its lawsuit over the firm’s ousted CEO, Travis Kalanick. The venture capital firm was trying to remove him from the ride-hailing company’s board. After SoftBank’s investment is finalized, Benchmark will reportedly drop the suit.

The deal could help Uber access markets in East and South Asia with SoftBank’s extensive ties across the region. Uber previously left China after determining that it could not compete with its Chinese rival, Didi.

SoftBank has investments in Uber’s competitors in India and Southeast Asia, like Ola and Grab.