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SoftBank purchase Uber shares at discounted price

Japanese giant Softbank are at it again. Following a number of high profile investments and acquisitions in recent times Softbank’s billionaire owner Masayoshi Son took his money out of his pocket again to acquire 15% of the massive global technology taxi company Uber.

The news has been broken following weeks of speculation that Softbank is looking to acquire shares at Uber or their main rival Lyft. Following the confirmation that Softbank has now purchased Uber shares, it is highly unlikely they will also invest in Lyft. The deal means that Softbank will now have two new members in Uber’s board of directors.

The purchase came at a discounted price as Uber’s value has significantly dropped following a difficult year. In 2016 the company was valued at almost $70 billion and Softbank’s acquisition would suggest that the company today is valued at $48 billion – 20% lower than its valuation in 2016.  

A handful of investors are buying out the remaining shares of Uber as the existing shareholders feel that now is the right time to cash out.

Uber has experienced a number of problems in 2017 with a series of scandals and regulatory setbacks. Most recently the company was involved in a court ruling case with the European Court of Justice which hit Uber with stricter regulations as they declared that Uber is a transportation business and not just a technology platform.  

Additionally, Uber was involved in a massive data breach scandal in 2016 which was covered up for more than a year and reported significant loses.

Uber will be hoping that the new shareholders will place Uber on a road towards a fresh start in 2018 and that the cash injection they will provide will be crucial in improving the company’s overall performance.  

“We look forward to working with the purchasers to close the overall transaction, which we expect to support our technology investments, fuel our growth, and strengthen our corporate governance” Uber stated.

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