Japan-based internet and telecommunications conglomerate SoftBank intends to transfer its shareholding in ride hailing companies Uber, Ola, Grab, 99 and Didi Chuxing to its Vision Fund, the Financial Times reported today.
Details of the transaction, which has not been finalised yet, are not yet clear, but the capital committed by Vision Fund is expected to increase if the restructuring is completed, raising the possibility it could transfer cash to its parent.
The stakes in Uber, Ola, Grab and 99 are currently held directly by SoftBank in part due to Saudi Arabia’s Public Investment Fund, which is a limited partner of Vision Fund, holding a share in Uber, people familiar with the matter told the Financial Times.
Yasir Al Rumayyan, chief executive of the Public Investment Fund, is on the board of both SoftBank and Uber. SoftBank’s stake in Didi Chuxing is held through a Jersey-based entity named SB Delta.
Merging all five companies into the Vision Fund portfolio would provide them with access to the fund’s resources and allow them to collaborate and create synergies more easily.
Rajeev Misra, who leads the Vision Fund, has previously expressed his wish for Uber to focus on core markets such as the US and Europe, as opposed to pursuing a worldwide strategy that would pit it against numerous domestic rivals.
There is already a substantial crossover between the various companies. Uber agreed to sell its Southeast Asian operations to local competitor Grab in February 2018 – though the deal is being investigated by Singapore’s regulator – and sold Uber China to Didi Chuxing in 2016.
Uber has also entered discussions to sell its Indian business to Ola, and Didi Chuxing acquired a majority stake in 99 in January 2018, after SoftBank had injected $100m in 99 in May 2017.
Didi Chuxing raised $5bn in April 2017 from SoftBank as part of a $5.5bn funding round, and the corporate returned in December to also back a $4bn round. SoftBank has also invested in Grab multiple times, beginning with a $250m series D round in 2014.
SoftBank acquired an 18% stake in Uber in December 2017 as part of a secondary share purchase and a direct investment with a combined value of more than $8bn.
News of SoftBank potentially moving the stakes into its Vision Fund comes as another reports states that it could soon celebrate an exit from Didi Chuxing, which is considering an initial public offering this year that would value it at up to $80bn.