The issue may arise with deciding on a price with Uber’s current shareholders and if that become a challenge, CEO Masayoshi Son may decide not to buy.

Will SoftBank ditch Uber and invest in rival LyftImage source: MIKI Yoshihito Via Flickr
Atom Fund Raising Tuesday, November 07, 2017 - 10:54

Even as Japanese conglomerate SoftBank is in advanced talks with global ride hailing startup Uber for a major investment, SoftBank CEO Masayoshi Son now says that it could still walk away from the deal and instead invest in Uber’s rival Lyft, according to a Bloomberg report.

Speaking at a press conference for SoftBank’s second quarter results, Masayoshi said that until the very end, they don’t either. “Depending on the price and conditions, it is wholly possible we could shift our investment to the other main company Lyft. It is wholly possible,” Bloomberg quotes him as saying.

SoftBank is planning to buy 14-20% of Uber’s shares. But Uber shareholders are negotiating with the Japanese conglomerate over the price at which those shares would be sold.

The issue may arise with deciding on a price with Uber’s current shareholders as more than half of the stake Masayoshi is looking for will come from these existing shareholders.

According to a Recode report, Uber’s existing shareholders seem to want a price per share that exceeds the $50 billion valuation that is currently under discussion, with one possible seller arguing for a price of at least $40 per share, or around a $60 billion valuation. Another investor says that the window of prices ranges from $35 to $45 a share.

And if arriving at a price becomes a challenge, Masayoshi may decide not to buy.

Other conditions that could also affect the deal with Uber are the buying process, board members and voting rights.

Bloomberg reports that it is possible that Son may go ahead and invest in both of the rivals. This, however, he did not mention in the press conference. However, he has invested in Uber’ Chinese rival Didi Chuxing before he started talks with Uber.

Interestingly, SoftBank also backs Uber’s biggest Indian rival Ola and recently raised a large round of $2 billion led by SoftBank and Tencent.

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