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SoftBank acquired 15% stake in UBER

Kushal Raut
Kushal Raut
Uber- "The Company which deals with Car Transport without owning a Single Car."

It is kind of surprising to know about this. But with Uber, there have been various ups & downs including the profit margins. So with a solution to that, the Uber seems to have sold off some of their stakes to SoftBank. SoftBank is a Japanese based Multinational Telecommunication Company who have acquired 15% stake in Uber. None of us saw this coming right after their coming as they offered huge cuts offs from the actual valuation of UBER. So what does it means for us and for UBER? Let us find it out.

WHAT DOES IT MEAN?

  1. There would be proper nature between the Board of Directors, unlike the older days where there be hiccups.
  2. Due to the various ups & downs with the company between the Investors and the Board of Directors.
  3. The Board has got more cash to play around which means more work would get done. People in the company would have stacks of cash including the early UBER Employees.
  4. Backed by the Strategic Powerful Partner- SoftBank, UBER might get more partnerships and business contracts all across the globe including Asia.
  5. The size of Board of Directors can be increased to 17 People out of which 2 would be acquired by SoftBank.
  6. This deals also means the decrease in UBER's value. The deal has been carried out with 30% discount which is insane for any company. UBER last year- $70 Billion; Deal: $48 Billion.

Reactions

This is kind of unexpected and has never happened. There aren't any companies for whom there is 17 Board of Directors (Max: IBM- 15 Members) Even the United Nations has fewer members i.e 15 members. :p SoftBank earlier too has acquired some other companies in the past. This deal is split into the 2 parts.

Image Source- Tech Crunch

Due to all these reasons, there are a lot of things going on internally, and also people reacting "Shame on Uber" cards. We are yet to see the consequences. Will there be a rise in the fares of UBER?  What do you think? Let us know in the comments below.

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