According to foreign media reports, Uber is in talks with its founder Travis Kalanick to help it raise funds for the acquisition of the U.S. business of Chinese self-driving company Pony AI Inc.
According to sources, negotiations are currently in the preliminary stages, and the financial details of the potential deal have not been disclosed. Bloomberg industry analysts said that given that Pony.ai’s U.S. operations have not yet generated revenue, any deal with Kalanick is “likely valued at less than $500 million.”
Image credit: Uber
If the deal closes, Kalanick will take charge of Pony.ai’s Delaware-based subsidiary while continuing to lead its existing business, CloudKitchens.
Affected by this news, on June 26, Uber’s stock price and Pony.ai’s American Depositary Receipts (ADRs) both rose to intraday highs, of which Uber’s stock price rose 3.8% to close at $93.12, a record high, and Pony.ai’s stock price rose 21%.
Both an Uber spokesperson and Kalanick declined to comment on the negotiations, and Pony.ai and CloudKitchens have not immediately responded to requests for comment.
Kalanick was removed from Uber’s CEO position in 2017 and resigned from Uber’s board of directors in 2019, when he completely cut off his last contact with the company he founded.
Over the past year, Uber has moved quickly to prove that it can be the go-to business platform for driverless car manufacturers. Uber has partnered with more than a dozen autonomous vehicle and software vendors, including Alphabet’s Waymo (it has partnered with Waymo in three cities) and has invested in some companies. This is in contrast to Kalanick’s strategy of developing autonomous driving technology independently during his time at the helm.
Skeptical Wall Street investors, thoughforecastWith the growing popularity of Waymo’s self-driving taxi service through its own mobile app and Tesla’s recent launch of a similar Robotaxi pilot service, Uber may face an existential crisis.
It was reported in November last year that Uber was negotiating to invest in Pony.ai’s initial public offering (IPO) in the United States, but the two sides have not disclosed the final size of the deal. Previously, Uber has partnered with Pony.ai to be the first to launch driverless taxi commercial services in the Middle East.
Headquartered in China, Pony.ai has obtained licenses for self-driving taxi paid services in select cities in China, as well as R&D operations and testing licenses in the United States and Europe. Toyota Motor Corporation is one of its largest shareholders, with a stake of nearly 16%.
