Uber Shareholders Including Kalanick Loosen Grip With Sales of Stock

Posted January 5, 2018 7:59 p.m. EST

SAN FRANCISCO — Several of Uber’s early investors and company leaders are beginning to loosen their grip on the ride-hailing company — and are set to reap big riches in the process.

Travis Kalanick, Uber’s former chief executive, has sold nearly one-third of his shares in the privately held company for about $1.4 billion, according to three people with knowledge of the transaction, who asked to remain anonymous because the details are confidential.

Benchmark, a venture capital firm that invested when Uber was very young, plans to sell about $900 million of stock, or close to 15 percent of its holdings in the company, these people added.

The buyer of all these shares is an investment consortium led by SoftBank, the Japanese conglomerate, which recently agreed to acquire $10 billion of Uber stock from shareholders. SoftBank, which has a $100 billion investment fund called the Vision Fund, has been on a spending spree since last year and has invested in ride-hailing companies and other tech companies around the world.

That Kalanick and some of Uber’s earliest investors are selling their shares is notable because they have long held an iron grip on the ownership structure. That led to bitter fights last year over control of Uber, with Benchmark at one point suing Kalanick to reduce his say over the company.

Representatives for Kalanick and Benchmark declined to comment. News of the sale amounts were previously reported by Bloomberg and Recode.

With Kalanick and some of the venture capital firms selling down their stakes, Uber’s chief executive, Dara Khosrowshahi, may have a freer hand to put his imprint on the service. Since Khosrowshahi was chosen to lead Uber in August, he has tried to clean up the scandal-ridden company, while trying to appease employees whose faith has been shaken by a year of executive changes and questions over its workplace culture.

Kalanick and Benchmark still hold board seats at Uber.

Uber previously restricted employees and insiders from selling their company stock. Now early employees, investors and Kalanick will finally be able to realize some of their enormous financial gains from Uber.

Uber’s true value is something of a mystery. SoftBank and the consortium of investors are purchasing some shares at a price that puts the value at roughly $48 billion. But SoftBank is also putting $1.25 billion of new capital in Uber at a $67.5 billion valuation — the amount at the company’s previous round of financing in late 2016 — as a way to prop up its perceived value.

As part of the deal, Uber will add several new directors to its board. Uber will also eliminate its “super voting shares,” a class of stock that gave outsize power to Kalanick and other holders of those shares.