Uber is going public at a $90 billion valuation - which is a quarter of SA's total economy
- Uber plans to raise more than $10.3 billion in its initial public offering, potentially giving it a market capitalisation of $90 billion (R1.3 trillion).
- The ride-hailing giant will offer 180 million shares at a price between $44 and $50 per share.
Uber plans to raise upwards of $10.3 billion in one of the largest initial public offerings in history, securing the ride-hailing giant a market capitalisation of up to $90 billion, according to a filing published on Friday.
South Africa's total GDP is currently valued by the International Monetary at $386 billion.
The ride-hailing giant will offer 180 million shares at a price between $44 and $50 per share. It plans to list its shares under the symbol UBER.
Uber plans to list its shares on the New York Stock Exchange under the symbol UBER.
"Building this platform has required a willingness to challenge orthodoxies and reinvent — sometimes even disrupt — ourselves," CEO Dara Khosrowshahi said in the filing.
"Over the last decade, as the needs and preferences of our customers have changed, we've changed too. Now, we're becoming something different once again: a public company."
Uber, whose app connects drivers with passengers in more than 700 cities worldwide, also announced it would pay about $300 million to more than 1.1 million drivers as a "driver appreciation reward." Qualifying drivers in the US will receive $100 to $40,000 in cash based on the number of trips they've completed. The payout for non-US drivers will be adjusted to average hourly earnings in their regions.
The company has also reserved 5.4 million shares for sale at the IPO price to US drivers who have completed at least 2,500 trips, including one trip this year as of April 7, and have an Uber account in good standing.
Uber continued to grow its total users, trips, and revenue in the first quarter of 2019, but its losses climbed too.
Monthly active users rose by almost a third, to 93 million from 70 million. Total trips jumped 36% to about 1.55 billion.
Revenue rose by 18% to 20%, to between $3.04 billion and $3.10 billion, according to Uber's preliminary estimates. Operating losses more than doubled to between $1 billion and $1.1 billion from $478 million.
Overall, Uber estimated that it lost $1 billion to $1.1 billion in the first three months of this year. The loss reflected higher platform costs including greater spending on incentives and promotions, as the company said it fought to maintain market share amid "increased competitive pressures" in the US and other markets.
Uber's adjusted figures don't read much better. Adjusted net revenue, which strips out certain driver incentives and referral perks, grew by 8% to 10% to between $2.7 billion and $2.77 billion in the first quarter of 2019, the company estimated.
The ride-hailing company had turned a profit in the first quarter of last year thanks to $3.16 billion in income from the sale of its Russian/Eurasian and Southeast Asian operations and a $2 billion gain from its investment in its Chinese ride-hailing rival Didi Chuxing. Its adjusted earnings before interest, tax, depreciation, and amortization, which exclude such one-off gains, widened this past quarter to a loss between $847 million and $954 million from $280 million.
Uber continues to expand into different industries with services such as Uber Eats and Uber Freight.
"We are still barely scratching the surface when it comes to huge industries like food and logistics, and how the future of urban mobility will reshape cities for the better," CEO Dara Khosrowshahi wrote in the filing.
Uber's IPO has drawn interest from several big names including PayPal. The payments giant has agreed to purchase $500 million in Uber stock at its IPO price in a private placement. The pair have extended their global partnership and plan to explore future collaborations including the development of Uber's digital wallet, according to a PayPal representative.
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