Published: Fri, October 06, 2017
Economy | By Guillermo Lane

Uber and Transport for London hold 'constructive' talks

Uber and Transport for London hold 'constructive' talks

Fulfilling some earlier rumours, the Uber board voted to strip certain shareholders, including Kalanick and early Uber investor Benchmark, of the enhanced voting rights baked into the two types of company stock - preferred and class B shares, the New York Times reports. "Kalanick sees the changes as poor corporate governance, meant to shift authority to Khosrowshahi and away from the board, a person familiar with the matter said". As Uber goes through the appeals process, the company's 40,000 drivers will be able to continue operating in the city. With governance reforms still being modified Tuesday morning, proposals created to shift power from the former CEO to the current one could be softened, the people said. In this setup, all shareholders will eventually have only a single vote per share, irrespective of the class of company stock they own. They proposed the removal of super-voting privileges, a provision that made it harder for for past executives to be named CEO and a 2019 deadline on the company to go public. A draft on Tuesday retains numerous major provisions, two people said.

John Colley, of Warwick Business School, professor of Practice in the Strategy and International Business group has commented: "Uber has a major cultural problem which has been found to be sexist, macho and lacks concern for regulation of nearly any sort".

Last week, Kalanick used his right to fill two vacant board seats, appointing former Xerox CEO Ursula Burns and former Merrill Lynch CEO John Thain.

Uber representatives were also in a San Francisco federal court on Tuesday for a decision in an on-going legal battle over trade secrets with Waymo, the self-driving auto unit of Google's parent company Alphabet. The move comes after numerous scandals that have threatened the firm's reputation, including a lawsuit by investors against its former CEO, Travis Kalanick. Although Khosrowshahi expressed disappointment at the surprise move, Uber said the two new directors were confirmed. Benchmark is a major proponent of the changes while Kalanick is opposed. Another option on the table is to bring the total to 17, with room for more independent directors, the people said.

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SoftBank's investment is about more than money-it's a vehicle for pushing Kalanick aside.

Recode's Kara Swisher and Theodore Schleifer reported more details on the proposals that the board is considering next week. For the Japanese firm, Uber represents the third major investment in a ride-sharing company, having previously backed China's Didi Chuxing and Southeast Asian taxi-hailing app Grab.

Uber's board held a phone call Saturday to discuss the governance proposals. The changes decided Tuesday would prompt Benchmark to end a lawsuit and arbitration proceedings against Kalanick, the two sources and another said.

Travis Kalanick, Uber co-founder and CEO and Michael Arrington TechCrunch founder (not shown) talk during a fireside chat at TechCrunch Disrupt SF on Monday, September 8, 2014 in San Francisco, Calif.

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