A group of investors led by Softbank Group Corp concluded a deal with Uber Technologies Inc on Thursday. The deal has made Softbank the largest shareholder in the ride hailing giant while simultaneously giving the company a much needed boost.

The agreement includes a large purchase of shares by existing investors and employees of Uber. The shares will be bought at a discounted valuation for the company of $48 billion, which is a 30 per cent drop from Uber’s most recent valuation of $68 billion. According to a spokesman for the company, the secondary stock sales was to be completed on the Nasdaq Private Market, by end of day Thursday.

The group, which was co-led by Softbank Group Corp and Dragoneer Investment Group and included Sequoia Capital, also concluded a fresh cash investment of $1.25 billion at another higher valuation, added the spokesperson.

“This is a great outcome for our shareholders, employees and customers, strengthening Uber’s governance as we double down on our technology investments and continue to bring our services to more people in more places around the world,” said a spokesperson for Uber.

The official closing of the deal marks the conclusion of a months-long process plagued with infighting among the board members. The power struggles in the company , which have been going on for quite a few months now , have been fierce –for instance , a considerably large and early investor of the company, Benchmark Capital sued in August to force Co-founder and former CEO Travis Kalanick off the board of Directors. In addition to this, Uber has also been fraught with controversies including federal crime investigations, a huge data breach and a lawsuit claiming theft of trade-secrets.

In October 2017, the board voted to move ahead with the Softbank investment. Although at certain points in time the deal came close to falling apart, last month Uber announced that the group of investors had the required number of willing stock sellers needed to go forward with the investment.

The investors will acquire a 17.5 per cent stake in Uber, with Softbank keeping 15 per cent to become the ride hailing giant’s largest shareholder. The investment has triggered numerous changes in Uber, predominantly in governance of the company. Under the agreement, Uber will expand its board from 11 to 17 members, including four independent directors. In addition to this there will be a limit on the voting power of certain shareholders and a slash on the control wielded by the former CEO Travis Kalanick, who continues to sit on the board. Benchmark has also agreed to drop its lawsuit against Kalanick upon the completion of the deal.

According to a source familiar with the matter who was not authorized to speak publicly about the matter since the plans still remain private, Softbank has added two representatives on Uber’s board of Directors: Rajeev Misra, who is the Chief Executive of Softbank’s Vision Fund and Marcelo Claure, who is the President & CEO at Spring Corp in addition to being on Softbank’s board of Directors. Uber, however, declined to confirm the addition of new board members.

“Uber has a very bright future under its new leadership,” said Rajeev Misra in a written statement, referring to the cab hailing giant’s new CEO Dara Khosrowshahi, who helped broker the deal and benefits from the additional governance changes.

Misra wants Uber to concentrate on expanding in the United States, Europe, Latin America and Australia and not Asia, which is considered to be among the most costly and competitive regions for the company, as per the source. Such a change could enable the company to achieve profitability faster however at the same time, it could signal a retreat from one of the biggest and fastest growing transportation markets.

Apart from Uber, Softbank also has stakes in the Chinese ride hailing giant Didi Chuxing, Indian firm Ola and Southeast Asia’s Grab, all of which happen to be Uber’s biggest rivals in the Asian market. Softbank did not face much trouble in attracting investor interest in the deal, as many investors and employees were unable to sell the quantity of shares they would have liked to, since Softbank had placed a limit on how many it would purchase.

Travis Kalanick sold around one-third of his 10 per cent stake in the company for approximately $1.4 billion according to another source familiar with the matter. He had reportedly offered to sell of half his shares in the company.

(Picture courtesy: Uber)