Uber's $1 Billion Power Move Hides a Bold Bet on Self-Driving Stock

Khac Phu Nguyen

Wed, May 14, 2025, 2:45 PM 1 min read

Uber (NYSE:UBER) conscionable dropped a $1 cardinal convertible enactment offering, but don't expect it to person into Uber stock. This one's wired into Aurora Innovation (NASDAQ:AUR)the autonomous driving startup Uber owns a chunk of.

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Instead of issuing regular indebtedness oregon equity, Uber is offering 0% exchangeable elder notes owed 2028, giving investors the enactment to person the indebtedness into Aurora shares astatine an archetypal terms of $8.50a astir 18% premium to wherever Aurora's trading now. The woody besides includes an other $150 cardinal successful notes if request surges. Investors won't get involvement payments, but if Aurora banal rallies 30% oregon much implicit a 30-day model successful the adjacent mates of years, Uber tin telephone the notes early. Translation? Uber's fundamentally saying: "If Aurora pops, we each win. If not, you get your currency back."

What's absorbing isn't conscionable the superior raiseit's what this operation suggests. Uber isn't diluting its ain equity. Instead, it's leveraging Aurora shares held by its subsidiary, Neben Holdings, arsenic collateral. No circumstantial plans for the currency person been disclosed, but this benignant of determination often signals optionality: strategical investments, equilibrium expanse flexibility, oregon deeper plays into the autonomous ecosystem. The enslaved marketplace is speechmaking it arsenic a quiescent stake connected aboriginal upsidenot conscionable successful Aurora, but successful Uber's broader self-driving thesis.

This nonfiction archetypal appeared connected GuruFocus.