Warren Buffett, Berkshire Hathaway, CEO, earlier this year had announced the proposal of $3 Billion investment in Uber Technologies Inc. But the deal discussions did not work out because of the disagreements in both the parties. People familiar with this matter proclaimed that the deal was canceled because of disagreements on its terms and size.
The canceled deal is suggestive of the winning bet that Berkshire Hathaway Inc. had made on Goldman Sachs Group Inc. during its financial crisis. Buffett had invested about $5 Billion in the deal with Goldman Sachs.
As per the proposed agreement, the organization would have offered a convertible loan to Uber. This move would have safe-guarded Buffett’s investment if Uber hit financial straits. At the same time, it would provide a significant advantage if Uber continued to grow in value. It is proclaimed that Buffett had initially offered well above $3 Billion.
During negotiations, Dara Khosrowshahi, Uber Chief Executive Officer, proposed to decrease the amount involved in a deal to $2 Billion. This proposal was put forward with the hope to the backing of Buffett while offering him a comparatively smaller share of the company. The deal could not be successful because the two sides were not able to agree on terms.
Buffett confirmed the talks to CNBC by saying that he is a great admirer of Dara. He explained that some of the report details are incorrect. However, he confirmed the talks between Berkshire and Uber.
Earlier last month, Uber had announced the addition of new safety button within its application. It is provided to the user to get a direct way to call 911. This will boost company’s flagging safety reputation. Recently, the company has announced that the proposed featured button is live and fully operational now across the U.S. It will allow riders to quickly contact their first responders in case of any safety issues during their trip.