In the wake of a possible lawsuit, Uber’s board of directors agreed to various changes that will set a new course for the beleaguered company.
Amongst the most notable plans are a stock sale (14 to 17 percent) to SoftBank, the Japanese telecom giant, efforts to take the company public by 2019, and reducing the corporate power of former CEO Travis Kalanick, according to the New York Times.
On Monday, two of Uber’s prominent investors, Shervin Pishevar and Steve Russell, threatened to sue the company if the vote to eliminate the supplemental clout carried by the “Class B common shares” (which yield 10 times as much voting power as Class A shares), and preferred stock. Their lawyer, Mark Geragos, did not respond to Ars’ request for comment on Tuesday.
“Today’s action by the board was the culmination of a blatant bait and switch, essentially robbing loyal employees, including the more than 200 early founding Uber employees and advisors, of their hard earned shareholder rights,” Pishevar and Russell said in a statement sent to other media, including Reuters.
Under the new plan, shareholders will eventually have one vote per share. The board has now reportedly been enlarged to 17 members, up from 11. A new provision also makes it more difficult for company leadership to fire the new CEO, Dara Khosrowshahi, before the planned IPO—they would need to vote by a two-thirds majority to make such a change.
In a corporate statement, Uber said “SoftBank’s interest is an incredible vote of confidence.”
SoftBank has been making notable acquisitions and deals amongst American tech companies recently: earlier this year it acquired Boston Dynamics, the robot company that Google had once nabbed. In 2016, SoftBank snapped up ARM Holdings, the British firm behind the popular low-powered microchips. Way back in October 2012, SoftBank purchased Sprint, a move spearheaded by its CEO, Masayoshi Son.
“He’s not an establishment player,” Steve Vogel, a professor of political science and the chair of the Center of Japanese Studies at the University of California, Berkeley, told Ars at the time. “He’s a very aggressive, risk-taking, entrepreneurial person. He’s been colossally successful and had some colossal failures. But overall he’s made an impact on Japan—he’s the closest thing to Bill Gates in Japan.”