Uber board approves SoftBank deal, governance reforms

Uber’s board on Tuesday voted to move forward with a potentially massive investment from SoftBank, as well as with a series of reforms designed to re-tool the board’s governance structure and limit the influence of ousted CEO Travis Kalanick.

The vote appears to be a win for Uber’s new CEO, Dara Khosroshahi, who is trying to turn around the beleaguered company after months of embarrassing scandals. But that’s been no easy task, as the deeply fractured board has continued to operate with a level of drama that seemed more befitting of a soap opera than a $70 billion company. Just last week Kalanick rocked the boat by appointing two new board members —  former Xerox CEO Ursula Burns and former Merrill Lynch CEO John Thain — without informing Khosroshahi or anyone else.

But in a statement Tuesday, Uber suggested everyone has kissed and made up.

“Today, after welcoming its new directors Ursula Burns and John Thain, the Board voted unanimously to move forward with the proposed investment by SoftBank and with governance changes that would strengthen its independence and ensure equality among all shareholders,” an Uber spokesman wrote in an emailed statement. “SoftBank’s interest is an incredible vote of confidence in Uber’s business and long-term potential, and we look forward to finalizing the investment in the coming weeks.”

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Those governance changes include expanding the board from 11 to 17 members, limiting shareholders to one vote per share (thereby cutting some of Kalanick’s voting power) and setting a deadline for Uber to go public in two years, Bloomberg reported.

The SoftBank deal, which the board also approved, reportedly could have a total price tag of more than $10 billion. The Japanese firm plans to invest as much as $1.25 billion at Uber’s current valuation of nearly $70 billion, and then buy up to an additional $10 billion worth of shares at a valuation of around $50 billion, Recode reported Tuesday.

Kalanick also cheered Tuesday’s board vote, despite its intention to curtail some of his power.

“Today the Board came together collaboratively and took a major step forward in Uber’s journey to becoming a world class public company,” he wrote in a statement emailed by a spokesman. “We approved moving forward with the Softbank transaction and reached unanimous agreement on a new governance framework that will serve Uber well. Under Dara’s leadership and with strong guidance from the Board, we should expect great things ahead for Uber.”

Photo: This Wednesday, June 21, 2017, file photo shows the building that houses the headquarters of Uber, in San Francisco. (AP Photo/Eric Risberg, File)

 

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