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Buffett Rebuffed: $3B Investment Offer To Uber This Year Fizzled After Talks Stalled

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Buffett Rebuffed: $3B Investment Offer To Uber This Year Fizzled After Talks Stalled
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Warren Buffett confirmed Wednesday that Berkshire Hathaway Inc. Class A (NYSE: BRK-A) (NYSE: BRK-B) held investment talks with Uber.

What Happened

The 87-year-old billionaire investor vaguely refuted some parts of the Bloomberg report that first exposed the interactions.

"I'm a great admirer of [Uber CEO Dara Khosrowshahi]," Buffett told CNBC. "Some of the reported details are not correct, but it's true that Berkshire had discussions with Uber."

Buffett did not clarify the errors he mentioned or shed light on the talks, but Bloomberg had reported that Berkshire’s offer for a $3-billion-plus convertible loan fell through over disagreements on terms and deal size.

Why It’s Important

Buffett’s interest in Uber lends the recovering firm validation ahead of its targeted initial public offering in the back half of 2019.

But the deal’s ultimate failure isn’t necessarily significant for Uber. Khosrowshahi said strategic investments are not currently in focus.

"It's not first priority for me right now," he told CNBC. "First priority is to continue building a management team, continue to invest in the brand and get us in a position where we can build a big business and, along the way, go public."

What’s Next

Khosrowshahi said that securing a Buffett investment remains a personal goal, but while talks may one day resume, Uber’s “enormous growth trajectory” bearing “considerable risk” may not align with Berkshire’s strategy.

"I don't think we necessarily fit in with the typical Warren Buffett investment,” he said. “Maybe we can be a different kind of an investment, a portfolio diversification play for him.”

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Photo courtesy of Uber. 

Posted-In: Bloomberg CNBC Dara Khosrowshahi Uber Warren BuffettNews Media Best of Benzinga

 

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