BENGALURU – Uber Technologies fell as much as 9 percent to a record low on Wednesday after shares held by early investors became available for sale following a six-month restriction since the ride-hailing company’s initial public offering (IPO).
Uber made its market debut at $45 (R668) per share in May, but has since lost more than 40 percent in value as the loss-making company struggled to retain investor confidence.
Much of Uber’s nearly 1.68 billion outstanding shares were under lock-up. In the IPO filing, Uber had said about 76 percent of its shares held by insiders, venture capitalists and other investors were under the restriction.
“Some of the sell-off over the last few days has been attributed to the fear of additional liquidity coming into the market as a result of the lock-up expiration today, and people were trying to get ahead of that,” said Matt Novak, managing partner at All Blue Capital, an Uber investor.
However, not all early investors will hit the market to book a profit as they might have bought shares above the current trading price of $25.58.
SoftBank Group, which has invested billions in Uber to become its largest investor, in 2017 bought preferred stock at $48.77 per share and common shares at $32.97 apiece from existing shareholders, including co-founder Travis Kalanick.