On Wednesday, while citing people familiar with the matter Bloomberg reported that earlier this year, Warren Buffett, the billionaire investor, had proposed to invest $3 billion (£2.2 billion) in Uber Technologies Inc. However, the negotiations failed after disagreements regarding the size and terms of the supposed deal.
The report said that the Berkshire Hathaway of Buffett would have given a convertible loan to Uber that would have protected the investment of Buffett should the ride-hailing firm suffer a financial crisis.
Dara Khosrowshahi, the Chief Executive Officer of Uber, suggesting a reduction of the size of the deal to $2 billion, presenting Buffett with a smaller share of the firm. citing a source, Bloomberg reported that the deal failed after the two sides could not agree on terms.
Last March, Uber raised its self-arranged term loan B to $1.5 billion. It was a bridge loan that was largely designed to fund steep cash burn until its planned IPO in 2019.
At the end of the same month, Uber had around $6.3 billion in cash, thanks in part to a direct investment by SoftBank Group Corp and other investors of $1.25 billion.
At a valuation of $48 billion, SoftBank bought in. It was discount from the $66 billion that Uber was once declared to be worth. Last week, Uber announced its first-quarter results and a tender offer that pushes its valuation past $60 billion.
Both a representative for Buffett and Uber did not immediately answer to a request for comment regarding the matter.
During an interview with CNBC on Wednesday, the legendary investor, Warren Buffett, confirmed that he held talks with Uber.
He stated: “I’m a great admirer of [Uber CEO Dara Khosrowshahi].
“Some of the reported details are not correct but it’s true that Berkshire had discussions with Uber.”
An investment from Berkshire could have served to be a stamp of approval for the ride-hailing company before an eventual IPO. Earlier this month, Buffett sent the stocks of Apple soaring when he announced a massive stake in the hardware giant.