After months of dilly-dallying, Japanese technology conglomerate SoftBank has finally agreed to invest multi-billion dollars in ride-hailing company Uber.
The San Francisco-based company confirmed investment in a statement without giving details. “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.”
The current deal may include an investment of $1 billion in the company at the last private valuation of nearly $70 billion, according to TechCrunch.
However, the online portal also added that SoftBank and Dragoneer Investment Group is also planning to invest a much larger amount by buying up to $9 billion in Uber shares from employees and other shareholders.
The Japanese conglomerate is in talks with Uber for the past few months and has plans to make the investment through its $93 billion Vision Fund and acquire between 14-20 percent in the ride-sharing company.
The investment deal includes both a direct investment in the company at the last private valuation and also a secondary transaction, buying out existing shareholders. These shares are expected to be purchased at a lower valuation, that has still not been determined.
Technically, the deal will only be done once enough Uber shareholders opt to sell shares. It is a package deal and the $1 billion investment in Uber is contingent on the tender offer getting finalized, according to TechCrunch.
The deal announcement comes a week later when SoftBank CEO Masayoshi Son said he could still walk away, and perhaps even invest in Uber’s rival Lyft Inc.
“Depending on the price and conditions, it is wholly possible we could shift our investment to the other main company Lyft. It is wholly possible. We won’t know until the very end,” said Son, at a press conference following SoftBank’s second-quarter earnings Monday last week.