As Uber tries to rapidly grow business across Asia, SoftBank’s investment in the company opens up opportunities of combining it with other ride hailing firms. Earlier this month, Uber planned a deal with a consortium led by SoftBank and Dragoneer Investment Group that will bring $1 billion to $1.25 billion into Uber while also buying up to 17% of existing shares in a secondary transaction.
SoftBank has also been a huge investor in Uber’s competitors across Asia such as Asia’s Grab, China’s DiDi Chuxing, and India’s Ola as ride hailing companies have been competing fiercely across Asia. Many discounts and promotions have been given out to try to attract both drivers and riders but resulted in low profit margins.
Currently, Uber is worth $68 billion and is the most highly valued venture backed company in the world. However, the firm needs to expand to new markets and combining with SoftBank would be most ideal for the two businesses. Uber already has a loss of $645 million in the second quarter this year, but has been sharpening their focus and resources on India and Southeast Asia.