CAPE TOWN - Uber co-founder, Travis Kalanick, is set to become a billionaire after the ride-hailing company entered a billion dollar investment deal.
Kalanick and Uber will be selling a large stake of its business to Japanese investors.
This comes after the company entered a R112 billion deal with a consortium led by Japanese telecommunications group, SoftBank.
The consortium will also purchase a large stake in the company from existing shareholders.
The deal will see Kalanick selling R16.8 billion of his own stock.
This deal will also make the Uber co-founder a billionaire.
While Kalanick is estimated to be worth billions already, he was merely a paper billionaire.
This is because the market value of Uber is worth billions. However, this does not mean Kalanick is a billionaire, until the holdings are liquidated.
Therefore, the SoftBank deal will cement Kalanick's wealth and he will officially become a billionaire.
Although Kalanick will remain a director at Uber, he will hold limited decision making controls.
By selling 29% of his shares, Kalanick will award SoftBank with two seats on Uber’s board.
For the R112 billion, a 17.5% stake will be bought in Uber.
Of that R112 billion, R15.6 billion will be a cash investment in new shares and the rest will go to Uber investors.
Meanwhile, the ride-hailing group this month announced a new advancement to the company.
Uber said they plan to carry passengers in autonomous vehicles without backup drivers as early as next year.
However, before the company rolls out this new project, it has to be deemed safe, said Advanced Technology Group leader, Eric Meyhofer.
"Once we can check that box, which we call passing the robot driver's license test, that's when we can remove the vehicle operator," Meyhofer said in an interview at an auto industry investors conference Detroit.
"We're going aggressively too”, said Meyhofer.
According to Meyhofer, Volvo XC90 SUVs are currently being prepared for this new project.
So far, Uber has 215 test vehicles carrying passengers with human backups in Phoenix, San Francisco, Pittsburgh and Toronto.
These vehicles travel 130 000km per week gathering data and have given 50 000 paid rides, said Meyhofer.
The ride service now has 1600 people working on autonomous vehicles in the four test locations.
While the testing is done in relatively small areas, Uber said it will gradually expand the size of the area as mapping is done and vehicles become more capable.
- BUSINESS REPORT ONLINE