Thomson Reuters
Uber’s board is considering whether to strip Travis Kalanick, the company’s founder and former CEO, of his power after he abruptly appointed two new board members without consulting the company’s leaders, according to Bloomberg.
The board plans to hold a vote on Tuesday on board reforms and whether to pursue a huge $ 10 billion stock deal with Japanese tech giant SoftBank, according to two Bloomberg sources that are said to be familiar with the matter.
Both matters could have a big impact on Uber’s governance structure. The potential changes have three major objectives, according to Bloomberg. They are:
- To create equal voting power among shareholders;
- To move the company toward a stock market listing in the next two years;
- And to limit Kalanick’s power as a shareholder and board member.
Kalanick, who resigned as Uber CEO in June amid criticism, holds three of the 11 board seats at Uber: his own and two previously vacant seats.
He shocked the board on Friday when he announced two new board members: former Merrill Lynch CEO John Thain and former Xerox CEO Ursula Burns.
Uber’s CEO, Dara Khosrowshahi, was not informed that Thain and Burns were being appointed to Uber’s board. They’re yet to be formally accepted onto the board but one of Bloomberg’s sources expects them to be welcomed.
In an email to Uber staff, Khosrowshahi said Kalanick’s decision was “disappointing,” according to Bloomberg. “Travis appointed two new members to Uber’s Board without discussing it with me or the Board of Directors more broadly. Anyone would tell you that this is highly unusual.”
The board reportedly had a phone call on Saturday to discuss the governance proposal, which would “shift Uber shareholders to one share, one vote.”
As a result, Kalanick’s voting power would be watered down, as would Benchmark’s (a venture capital company that counts itself as Uber’s majority shareholder). Benchmark is in favour of the reforms, but Kalanick is not.
The new reforms would enable Khosrowshahi to occupy three board seats if the current board members who occupy them gave them up, according to Bloomberg.
The plan would also strip Kalanick of one of his board seats and give it to SoftBank, Bloomberg reports. Kalanick’s remaining seat would reportedly require Khosrowshahi’s approval. Another caveat is that it would need to be filled by a C-suite member of a current Fortune 100 company. It’s unclear what will happen now that Kalanick has tried to fill the other two seats himself.
Uber has had a tough year involving multiple legal battles around the world, allegations of sexual harassment, and a number of high-profile departures.
Uber did not immediately respond to Business Insider’s request for comment.
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