Oct 19, 2017

SoftBank preps final play for Uber

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We've not discussed the Uber-SoftBank transaction lately, so let's do it now. And, in honor of Gordon Hayward's surgery apparently going well, let's treat it like the game it has become:

Possession arrow: SoftBank

  • Everyone currently is waiting on the Japanese giant, which has not yet set a price, nor even communicated how it plans to run the auction process (i.e., fixed tenders, Dutch auction, etc.). It has, however, tried to do price discovery via some one-on-one conversations, and most sources expect formal details within a week.

Over/under: 41.65.

  • That's Uber's most recent 409a valuation, which works out to around a $60 billion valuation based on the current share count. It also seems to be the number below which many shareholders won't even consider a deal (and below which those with pro rata rights — like Benchmark and TPG — could become buyers). That's got to be causing SoftBank some heartburn, given that it originally proposed pricing the deal near a $50 billion valuation.

Halftime quotes

  • "Everyone wants to provide as little transparency as possible." — Uber investor
  • "I know a lot of people don't think it gets done in the end, but they also thought Dara wouldn't get over the governance hurdles. He wants this, and I wouldn't bet against him." — (different) Uber investor

Rules clarification

  • There was a recent FT report about how Benchmark wouldn't raise its ROFR rights in regards to the tender, but sources say the ROFR only relates to shares being (possibly) offered by Travis Kalanick, Ryan Graves and Garrett Camp.

Different sort of court

  • Uber's former chief business officer, Emil Michael, yesterday was dropped as a defendant in a privacy invasion lawsuit filed by a woman who was raped by an Uber driver in India. The company itself remains party to the suit, as do Travis Kalanick and former executive Eric Alexander.z

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