Softbank’s potential investment in Uber

Regarding Softbanks potential investment in Uber over the weekend, Mergermarkets research editor Elizabeth Lim has commented below about the deal:  
  • Sunday’s news of SoftBank’s bid with a consortium for a significant stake in Uber shows the company’s continued effort to be the king of high-profile start-ups.
  • SoftBank also owns stakes in other ride-sharing startups around the globe, including Brazil’s 99Taxis, China’s Didi Chuxing, and India’s Ola, though it does not currently have a stake in Uber’s main competitor in the US, Lyft.
  • To date this year, the company has engaged in a record 29 transactions, almost 5x the number for the whole of last year, and with only one transaction having lapsed – a US$1.8 billion attempt to acquire Luxembourg - based satellite provider Intelsat in the first half of the year.
  • SoftBank’s buys have been fairly representative of a market share grab taking place throughout the industry, and have ranged from medical testing start-ups (Guardant Health) to budding autonomous vehicle companies (Nauto) to artificial intelligence (Appier; Petuum) and robotics firms (Boston Dynamics; Schaft) to co-working spaces (WeWork). Investments have especially picked up following the Vision Fund’s formation and close with US$93 billion.
  • Deals that have closed over just the last few months have included such ventures as a US$250 million bid with Accel for popular messaging platform Slack, a US$114 million bid with Qualcomm Ventures for autonomous robot company Brain Corporation, a bid as part of a consortium of sponsors for an undisclosed consideration of indoor farming start-up Plenty, and the full-on acquisition of US cyberdefense company Cybereason, also for an undisclosed consideration, among many others.
  • Most of SoftBank’s bids have been as part of various consortia – altogether, they have taken stakes in companies worth a combined US$25 billion so far this year, with no sign of letting up on that momentum.
  • Uber has attempted to move past its recent woes by resolving certain issues within its board, which paved the way for this investment to take place. With plans for an IPO in 2019, SoftBank's stake buy and two new board seats signal a move forward finally for the ride sharing company.