Less than a week after ride-hailing firm Uber Technologies Inc. cleared the way for a significant investment by SoftBank Group Corp. (SFTBY) , a potential snag has arisen.
Benchmark Capital, one of Uber's largest shareholders who has previously sued its former CEO Travis Kalanick, has declined to waive its right of first refusal over the upcoming tender offer, the Financial Times first reported.
The waiver by not only Benchmark but other significant Uber investors, those owning more than 2 million shares, has puzzled the ride-share firm.
Under current terms of the deal, SoftBank along with other investors will spend between $1 billion and $1.25 billion to purchase additional shares in Uber at a valuation of roughly $68 billion. The deal will also see the group purchase secondary shares from existing shareholders at a valuation said to between $45 billion and $50 billion.
Because SoftBank group has yet to submit a price for the secondary shares, major Uber shareholders have the right of first refusal to dismiss the purchase. Several shareholders wish to see the amount first before deciding on whether to buy or sell, according to the report.
SoftBank expected that the majority would be sellers.
The investment by SoftBank, approved last week by Uber's board, will also usher in governance changes at the ride-hailing firm, namely the expansion of its board to 17 seats.
The tender offer is reportedly expected later this month, but before its submission the Softbank-led group must submit its price and reach an agreement with the significant shareholders exercising their right of first refusal.