Is Uber Co-founder And Former CEO Travis Kalanick Completely Exiting His Stake?
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After the post-IPO lockup period ended, Uber co-founder and former CEO Travis Kalanick has been on a sharing selling streak since early November. According to a report by The Wall Street Journal, Kalanick has already offloaded more than 90 per cent of his stake worth $2.5 billion. If the selling streak continues at this rate, Kalanick will completely exit his stake in the company within a few days.
According to recent media reports, Kalanick offloaded another $383 million worth of shares last week within December 16 and December 18. He reportedly sold 7.8 million shares on December 16 alone. Currently, his remaining stake is worth about $250 million.
Entrepreneur India has reached out to Uber for further comments on the development.
What Is The Reason Behind This Move
While the company is yet to issue any statement on this regard, quoting industry experts several media reports have said that this move can be interpreted as a vote of no confidence in current management and raising questions about Kalanick’s status as an Uber board member.
On the other hand, Kalanick might also have plans to completely exit Uber and focus on his new venture CloudKitchens.
Kalanick who co-founded Uber in 2009, resigned from his post of CEO in 2017 after a series of scandals and controversy and sexual harassment allegations. According to reports, nine months after he resigned from Uber, Kalanick forayed into delivery-only kitchen segment and took up the responsibilities of CEO of City Storage Systems which was formerly called, CloudKitchens. He had acquired a majority stake in City Storage Systems for $150 Mn using the investment fund he set up from $1.4 billion stock sale from Uber.
Last month, it was reported that Kalanick has been ramping up its hiring in India with an aim to grow his new venture. According to reports, India is the top priority for Kalanick as the food tech space in India has been steadily growing.
Uber’s Failed IPO
The US-headquartered ride-hailing giant has been experiencing a rough year after a disappointing run at the New York Stock Exchange. Earlier this year, the company had opened its first day of trading with an initial public offering price of $45 but finished the day at $41.52 -- down 7.7 per cent.
The company had raised $8.6 billion through the IPO. According to reports by Business Insider, 180 million shares were sold during the offering which should have raised $12.8 billion for the company.
Uber’s India Focus
Recent reports also revealed that in order to attract more investment in India, Uber is planning to make the country, its main engineering hub. The company is planning to hire more than 1000 people for its technology functions by the end of 2020 across its offices at Hyderabad and Bengaluru.
In October, Uber restructured its corporate holdings to bring its India cab and food delivery business under Uber India Systems. Prior to this, Uber’s ride-hailing and food delivery business was a part of Uber BV, a private limited liability company which is registered in the Netherlands. With this, Uber’s agreements with restaurants and payouts which were sent via the Netherlands-based company will be shifted to India. The rides business will be invoiced out of India as well in the future.