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Japan's SoftBank wants to buy Uber shares but on 30% discount

SoftBank-Uber deal will be among one of the biggest business transactions.

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If both the parties involved accepted the deal, then this transaction would be qualified as the largest secondary transaction in history. (Reuters)
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A SoftBank Group-led team of investors has made an offer to buy app-based cab aggregator Uber's shares. The deal if happens, would value the company at about a 30 per cent discount to its last private valuation of nearly USD 70 billion.

According to TechCrunch.com, the proposed price for Uber's shares is USD 32.96 per share which roughly amounts to USD 50 billion.

If both the parties involved accepted the deal, then this transaction would be qualified as the largest secondary transaction in history.

Earlier, Uber had announced that it would "enter into an agreement with a consortium led by SoftBank and Dragoneer on a potential investment".

The tender would include nearly USD 9 billion of shares from existing shareholders, which is the amount needed to get the SoftBank-led group its desired 14 per cent in the company.

Uber employees with at least 10,000 of vested shares will be eligible to sell.

Moreover, other Uber shareholders, which include venture capitalists, angel investors and former employees could also be eligible.

But, it is also possible that if SoftBank does not find enough sellers at the USD 32.96 share price, that they may raise the price to meet the desired 14 per cent ownership.

SoftBank, who owns a portion of Ola, India's app-based transport provider, plans to purchase the Uber shares along with other investors. Reports suggest that the Japanese conglomerate will gain two Uber board seats as part of the investment.

The agreement comes in the wake of a board meeting, in which directors voted to move forward with an investment from SoftBank. As part of the deal, Uber's board agreed to major governance changes, including curbing the powers vested in former CEO Travis Kalanick, on account of his position on the company's board.

For the unversed, Travis was allegedly forced to step down from his position following severe backlash from the company's shareholders. The company had reportedly faced a string of revolts from the shareholders, few of which demanded Kalanick's resignation.

In August, putting an end to months of retrospection over finding a successor to Kalanick, Uber chose former Expedia CEO Dara Khosrowshahi to take charge as its new chief. While the Board was reportedly in favour of Hewlett Packard Enterprise Chief Meg Whitman taking over, they finally decided on Khosrowshahi for the position of CEO.

(With inputs from Agencies)

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