Nov 12, 2017

SoftBank's Uber deal takes major step forward

Photo: Jaap Arriens / Getty Images

Uber's warring factions have agreed to a truce that will allow Japan's SoftBank Group to launch a tender offer for at least a 14% stake in the ride-hail company, per multiple sources.

Bottom line: This is major development, but doesn't mean the deal will actually be consummated. Instead, SoftBank now will propose a price at which it would buy stock from eligible Uber shareholders, who would then have 30 days to tender.

This deal has been in a holding pattern for several weeks, due to a disagreement between ex-CEO Travis Kalanick and venture capital firm Benchmark. The resolution – which allows a voting rights agreement to be signed shortly – is twofold:

  1. Benchmark will suspend its lawsuit against Kalanick during the tender, and drop it if the deal gets closed.
  2. Kalanick will allow a majority of the board to approve (or disapprove) his future nominees to three board seats that he currently controls.

Key now is what price SoftBank proposes. As we've previously reported, SoftBank likely will need to come up for its indicative proposal that valued Uber at around $50 billion.

Benchmark and other early investors have agreed not to discuss their sale plans with one another, while SoftBank has agreed that all of its secondary share purchases will be at the same price (it had initially wanted to offer a premium to early sellers).

Update: Uber confirms progress in its talks with the investors. From a spokesperson:

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.

Go deeper

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 1 p.m. ET: 1,237,420 — Total deaths: 67,260 — Total recoveries: 252,944Map.
  2. U.S.: Total confirmed cases as of 1 p.m. ET: 312,762 — Total deaths: 9.132 — Total recoveries: 15,044Map.
  3. Public health latest: CDC launches national trackers and recommends face coverings in public. Federal government will cover costs of COVID-19 treatment for uninsured. Surgeon general says this week will be "our Pearl Harbor, our 9/11 moment."
  4. 2020 latest: "We have no contingency plan," Trump said on the 2020 Republican National Convention. Biden says DNC may have to hold virtual convention.
  5. States updates: New York Gov. Andrew Cuomo said the state "literally going day-to-day" with supplies.
  6. Work update: Employees still going to work face temperature checks, distanced work stations, protective devices and mass absences.
  7. What should I do? Pets, moving and personal health. Answers about the virus from Axios expertsWhat to know about social distancingQ&A: Minimizing your coronavirus risk.
  8. Other resources: CDC on how to avoid the virus, what to do if you get it.

Subscribe to Mike Allen's Axios AM to follow our coronavirus coverage each morning from your inbox.

Cuomo says New York is "literally going day-to-day with our supplies"

New York Gov. Andrew Cuomo said in a press conference on Sunday that New York is struggling to maintain medical supplies while combatting the novel coronavirus — operating "literally" on a "day-to-day" basis.

Why it matters: New York City has become an epicenter of the coronavirus outbreak, facing mass quarantines and stay-at-home orders. Cuomo said Saturday that New York reported 630 new deaths in 24 hours — an "all-time increase" that beat the previous day's record of 562 deaths.

Illinois governor: "The president does not understand the word 'federal'"

Illinois Gov. J.B. Pritzker said on CNN's "State of the Union" Sunday that President Trump's comments about the federal government's stockpile of medical equipment suggest he "does not understand the word 'federal.'"

Why it matters: White House adviser Jared Kushner argued at a press briefing last week that the "notion of the federal stockpile was it’s supposed to be our stockpile; it’s not supposed to be state stockpiles that they then use."