Uber is in talks to sell a minority stake in its self-driving unit to a group of investors including SoftBank’s Vision Fund and Toyota ahead of the ride-hailing company’s anticipated initial public offering, according to two people familiar with the matter.
The group is considering investing at least $1bn in Uber’s Advanced Technologies Group in a deal that would value the unit between $5bn and $10bn. The negotiations have not concluded and could fall apart.
Uber and SoftBank declined to comment.
Toyota said in a statement: “Toyota constantly reviews and considers various options for investment. We do not have anything to announce about a further investment in Uber at this time.”
The talks were first reported by The Wall Street Journal.
Taking outside investment would allow Uber to retain operational control of ATG while sharing the cost of developing and commercialising autonomous technology with partners. Putting an attractive price tag on the unit would also help in Uber’s pitch to take the company public at a valuation that could exceed $100bn, as it is expected to do in the coming months.
SoftBank became Uber’s largest shareholder last year when it paid $7.7bn for a 15 per cent stake, a significant portion at a discounted $48bn valuation. Toyota invested $500m in Uber in August as part of a deal to collaborate on technology for a fleet of autonomous vehicles that will be hailed using the Uber app.
Uber has been considering selling a stake in ATG since at least October, amid pressure from investors over the high costs of developing autonomous technology. Uber spends at least $500m a year on the unit.
Chief executive Dara Khosrowshahi has pledged to take a “disciplined” approach to spending, but has also been adamant that Uber continue to pursue self-driving, which he sees as critical to its long-term future.
Scrutiny of ATG intensified last year after a deadly crash involving one of its self-driving test cars in Arizona last year. Uber suspended public road testing for months following the deadly collision, but returned cars to the road in December.
SoftBank and Toyota have a separate $17m joint venture, called Monet Technologies, to use self-driving vehicles to provide services from food and goods delivery to medical check-ups. SoftBank has also invested $2.25bn in Cruise, General Motors’ autonomous car unit.
Additional reporting by Kana Inagaki in Tokyo
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