Uber may tune into Spotify IPO
Fortune scribe Adam Lashinsky has a new book out out on Uber, and toward the end includes this anecdote from a private plane trip in China last summer:
"Kalanick loves nothing more than to bat around ideas, the zanier the better. He wonders aloud to Emil Michael, his top deal-maker and fund-raiser, if Uber could go public without investment bankers. Michael, a lawyer by training, suggests instead a reverse merger... Kalanick suggests using no bankers but giving 3% of the capital raised ― the fee bankers would have received ― to charity. When I suggest giving that money instead to drivers, Kalanick lights up. He says he wants to give equity to drivers... but Uber has found the securities-law implications to be complicated."
That part about "using no bankers" might have sounded zany in mid-2016, but that was before Spotify decided to prep a direct listing that is expected for later this year. Moreover, the WSJ today reports that the New York Stock Exchange is asking the SEC to approve a change to its listing standards so as to permit direct listings on the Big Board (thus letting it better complete with Nasdaq, which already takes direct listings).
If Kalanick still likes this idea, then a blueprint may be waiting by the time Uber is ready to take its public plunge.
As for the driver equity angle, it's worth noting that Reddit has regularly talked about something similar for its top users ― preferably via a cryptocurrency scheme ― but has run into its own regulatory challenges.
Some additional Uber notes:
- Timeline: Eric Holder is expected to present his report on Uber's workplace issues ― including allegations of sexual harassment and discrimination ― to the company's board of directors tomorrow, Axios has learned from multiple sources. An all-hands meeting is then scheduled for June 6 to discuss the findings with employees, although the full report is unlikely to be disseminated either internally or externally (in large part to protect the confidentiality of those who spoke with Holder and his fellow investigators). It is unclear if this schedule will change due to the tragic death of Bonnie Kalanick, mother of Uber CEO Travis Kalanick, in a weekend boating accident that also injured Travis' father Donald.
- Moving on: Josh Mohrer this morning announced that he is stepping down as general manager of Uber's New York City business, in order to become a managing director with Tusk Ventures (led by political strategist Bradley Tusk, who has worked with Uber on various regulatory issues). No word yet on who will take over for Uber in NYC.
- It's complicated: There is a very complex web of ride-hail relationships ― in terms of investments, personnel, lawsuits and strategic partnerships ― where rivalries and alliances are often one in the same. We've put together a cool interactive graphic to help you keep track of it all.
First Data (NYSE: FDC) has agreed to acquire CardConnect (Nasdaq: CCN), a King of Prussia, Penn.-based provider of payment processing solutions to SMEs, for around $750 million in cash, or $15 per share (9.98% premium over Friday's closing price). KKR holds a 58.3% stake in First Data's outstanding stock, while FTV Capital holds a 34% stake in CardConnect.
- Why it's the BFD: Payment processing is all about volume, and this deal is expected to give First Data an extra $26 billion in annual payments from 67,000 small and mid-sized merchants. This also is First Data's largest acquisition since its 2015 IPO.
Venture Capital Deals
Private Equity Deals
• Alfa, a British provider of financial software for the auto finance and equipment leasing markets, raised £254 million in an IPO at an initial market cap of £975 million (which climbed to £1.25 billion on its first day of trading). It trades on the LSE under ticker symbol ALFA. http://on.ft.com/2s7sQBR
🚑 ABRY Partners has sold International Medical Group, an Indianapolis-based provider of medical insurance products and assistance services, to Sirius International Insurance Group for an undisclosed amount. www.imglobal.com
• Norvestor has hired Mooreland Partners to find a buyer for Abax, a UK-based provider of vehicle monitoring software, according to Dow Jones. Investcorp is among interested suitors. Abax generated around £43 million in 2016 revenue. http://bit.ly/2s7Akoo
Final Numbers: VC investment in U.S. cleantech
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