SoftBank to buy chunk of Uber

SoftBank to buy chunk of Uber

Now, the company has confirmed that Uber has sealed a multibillion dollar investment round from Japan.

SoftBank, along with Dragoneer Investment Group and General Atlantic, are expected to invest at least $1 billion in Uber and purchase up to $9 billion worth of Uber shares from existing investors.

Uber's statement said it reached an agreement with a consortium led by SoftBank and Dragoneer Investment Group. The initial price for the tender offer may not be set for more than a week, a person familiar with the matter said.

"We believe this agreement is a strong vote of confidence in Uber's long-term potential", it said.

The move was unveiled shortly after reports emerged that its former CEO Travis Kalanick and an influential investor had buried the hatchet, paving the ways for the acquisition.

Softbank is a major Japanese conglomerate which has made a habit of investing in tech firms in Silicon Valley, with the likes of Slack and WeWork already on the receiving end of major investments from the company, which also bought United Kingdom chipmaker ARM Holdings. Benchmark has also agreed to immediately suspend its lawsuit against Kalanick, which it filed in August.

This new funding deal will only be done once enough Uber shareholders opt to sell their shares. But there will likely be some wrangling over how much shares are worth in the coming weeks.

But it was threatened by conflict between Kalanick and Benchmark.

Benchmark agreed to drop the lawsuit in return for Kalanick's board power being diluted but its co-operation depends on the Softbank investment going through.

The deal would be positive for Uber, which is looking to turn a new page in the wake of recent repeated scandals, among them workplace sexual harassment allegations.

If completed, Uber plans to use the funds to expand its business further as well as boosting its investments in technology and strengthening its corporate governance.