By Douglas MacMillan and Justin Baer
Uber Technologies Inc., already the most highly capitalized
private company backed by venture capital, just added to its pile
of cash.
The car-hailing service raised an additional $1.6 billion in
convertible debt from Goldman Sachs Group Inc.'s high-net-worth
clients, according to people with knowledge of the transaction.
Uber is adding to its formidable war chest to fuel a rapid
global expansion. The ride-sharing app has expanded to more than
270 cities around the world, and is working to overcome obstacles
in places like India and Spain, where regulators have taken action
to ban the service.
Uber has previously raised $2.8 billion in equity funding, the
most by any private company backed by venture capital on record,
according to Dow Jones VentureSource, which has tracked venture
capital since 1992. Indian e-commerce company Flipkart Internet
Pvt. is the second most capitalized in the world with about $2.5
billion in equity funding. The previous U.S. record was held by
Facebook Inc., which collected $2.2 billion in equity before the
social network's initial public offering.
Investors valued Uber at $41.2 billion in its most recent equity
funding last month. The company now has raised more than $4 billion
in equity and debt funding.
Uber is still in talks to raise an additional $600 million from
investors, which may include international partners that can help
the company's efforts to expand abroad, the person familiar
said.
The convertible debt from Goldman is a six-year bond that
converts to stock at a 20% to 30% discount to Uber's valuation when
it holds an IPO, one person familiar with the deal said.
Clients of Goldman's wealth-management division typically must
have a net worth of more than $10 million. The division's some 600
advisers oversee about $300 billion in client assets.
In 2011, Goldman also allowed its wealthy clients the chance to
invest in Facebook ahead of its IPO. For Facebook, Goldman clients
were offered the opportunity to purchase equity, whereas the Uber
offering is in convertible debt.
The amount Uber raised from Goldman Sachs clients was reported
earlier by Bloomberg. News of the offering was first reported last
month by Fortune.
Write to Douglas MacMillan at douglas.macmillan@wsj.com and
Justin Baer at justin.baer@wsj.com
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