A consortium led by SoftBank and investment group Dragoneer has made a deal with Uber to invest billions into the ride-hailing company.
The deal is said to be worth up to $10bn following Uber board members, which includes venture capital Benchmark and former CEO Travis Kalanick, arriving at agreement terms for SoftBank to go ahead with its multi-billion dollar investment.
The deal could also prove to be a huge victory for Uber’s new CEO Dara Khosrowshahi, after he served as a mediator to help complete the agreement
SoftBank and Dragoneer Investment Group are expected to invest around $1bn into new shares in the company, as well as buying up to 17% of shares in the ride-hailing firm from existing investors and employees in a second transaction.
In a statement, Uber said: “We’ve entered into an agreement with a consortium led by SoftBank and Dragoneer on a potential investment. 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.”
Uber has said on completion of the deal it will use the funds to boost the company’s expansion and investments across the technology sector, as it faces competition around the world from rivals such as Lyft.
Following completion of the deal would also signal somewhat of a new era for Uber after a series of controversial events in the last year.
Uber has suffered many setbacks including the company’s license renewal across London, workers’ rights and allegations of a toxic working culture.
As well as giving Uber a fresh start it also ties in new governance rules for the company, which aim to distribute more power equally across the company and bring more oversight.
Uber’s board has already approved a set of governance reforms on the basis that the deal goes ahead.
These include removing super-voting rights, adding new independent directors and increasing the size of Uber’s board to a total of 17 members, which will hopefully bring some more stability to the company.
Uber would not be the first of its kind to receive investment from SoftBank, after the Japanese company has already invested in rival company Grab and Indian ride-hailing firm Ola.
The investment would further SoftBank’s existing portfolio of investments, including robot-maker Boston Dynamics, UK tech firm ARM, Endpoint Security, Nvidia, WeWork, OneWeb and SoFi.
Although terms have been agreed for the investment, the completion of the deal could take weeks to complete.