Uber Truce Cuts Power of Ex-CEO

Agreement clears way for IPO, sources say
By Newser Editors and Wire Services
Posted Oct 4, 2017 2:13 AM CDT
Uber Truce Cuts Power of Ex-CEO
People make their way into the building that houses the headquarters of Uber in San Francisco.   (AP Photo/Eric Risberg)

Uber is curbing the power of former CEO Travis Kalanick and taking on Japan's SoftBank Group as a major new investor as the service tries to recover from internal strife and a myriad of legal headaches. The changes adopted unanimously Tuesday by Uber's 11-member board strip Kalanick and other early investors of the extra voting power they were originally granted to control the privately held company's direction, sources briefed on the board vote tell the AP. Kalanick, who stepped down as Uber's CEO in June under pressure from irate investors, was among the directors who approved putting everyone on equal footing.

Kalanick agreed to the provision weakening his power partly to block a proposal that would have prevented him from ever returning as Uber's CEO, a source says. The truce clears the way for SoftBank to invest about $10 billion in Uber and get two seats on an expanded board that will consist of 17 directors. SoftBank's investment is based on Uber's current valuation of about $69 billion. In another vote, the board agreed to pursue an initial public offering of Uber's stock by the end of 2019. Before an IPO, two-thirds of the board would have to approve a switch in CEOs, a provision designed to prevent the ouster of Kalanick's successor, Dara Khosrowshahi, one of the AP's sources says. (More Uber stories.)

Get the news faster.
Tap to install our app.
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.