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Helluva down round (the $400M in cash is the most telling in my opinion and reminds me of the kickback that IBM had to pay to "sell" its chip foundries [1]). I
by femto113 6y ago
Helluva down round (the $400M in cash is the most telling in my opinion and reminds me of the kickback that IBM had to pay to "sell" its chip foundries [1]). If Uber's new stake is worth $2.5B, then the equity is worth only ~$2B. Last year Toyota+Denso+SoftBank paid $1BN for 13% of ATG, so by the new valuation their stake is now worth only about about $280M, or an over 70% loss in value in just one year.
[1] https://www.extremetech.com/computing/192430-ibm-dumps-chip-unit-pays-globalfoundries-1-5-billion-to-take-the-business-off-its-hands#:~:text=IBM%20is%20paying%20GlobalFoundries%20around,making%20unit%20off%20its%20hands https://www.extremetech.com/computing/192430-ibm-dumps-chip-....
- hn_throwaway_99 6y agoI think you hit the nail on the head regarding the $400 million in cash. This was a payment to get ATG off Uber's books, and given how much money ATG loses sounds like it was basically a "we'll pay for a year or so worth of expenses" kind of deal. My biggest question about this deal is that is combining a 600 person company with a 1200 person company (obviously many/most of those people will not be sticking around). Those types of large technology merges are extremely challenging in the best of times, but I'm curious how it will work out in an era where so many people are teleworking (but I don't know, could even be better, as there is less opportunity for offhand office gossip).