Uber peace deal paves way for SoftBank's $10bn investment

Uber is close to finalizing a multibillion-dollar investment by Japan's Softbank. | AP file

Ride-hailing giant Uber Technologies Inc.is close to finalizing a multibillion-dollar investment by Japanese technology conglomerate Softbank, a person briefed on the deal said.

In the deal reached Sunday, the reports said, SoftBank would buy $1 billion in new stock valued at Uber's current valuation of $68.5 billion, but the majority of the stake purchase will come from the Softbank consortium buying current Uber shares from investors to reach the 14 percent mark. The deal is a vote of confidence in the company's potential and "will help fuel our investments in technology and our continued expansion at home and overseas, while strengthening our corporate governance", the statement said.

The long-awaited investment was announced in October but was delayed by a corporate governance and legal dispute between investor Benchmark Capital and ousted CEO Travis Kalanick.

The two parties have now reached an agreement on control of board seats, which included Benchmark putting its lawsuit on hold, while Kalanick will allow directors to vote on his future appointments to the three seats he oversees, the Wall Street Journal reported citing anonymous sources.

As part of the deal, Benchmark, an early Uber investor which has a seat on the board, would suspend a lawsuit against Kalanick, and drop it once the tender offer is completed. Recode hears the deal depends on Uber shareholders offering enough stock for sale (SoftBank might have to pay extra otherwise), but it's clear both sides are at least willing to bet that this will happen.

But it was threatened by conflict between Kalanick and USA venture capital firm Benchmark. But there will likely be some wrangling over how much shares are worth in the coming weeks.

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