Uber wants to sell Didi, other non-strategic stocks, says CEO

The CEO of Uber Technologies Inc. said on Tuesday that the company is considering selling a stake in investments it considers non-strategic to other companies, including its shares in China's Didi Global Inc.

Speaking in a virtual fireside chat with UBS analyst, CEO Dara Khosrowshahi said many of the companies in which Uber has a stake have recently gone public and are still in a lock-up period.

While Khosrowshahi said Uber would continue to hold some stakes for strategic reasons, he intended to sell many of them, including in Didi.

"Our stake in Didi we don't consider strategic. They are a competitor, China is quite a difficult environment with very little transparency," the Uber CEO said.

Khosrowshahi said the company was in no hurry to sell the shares. "Such stakes we hope to monetise intelligently over time," he said.

Uber shares rose 4.3 per cent to close at $37.26 after Khosrowshahi's speech on Tuesday. He also said Uber had the best week last week in terms of company-wide gross bookings related to passenger transportation and food delivery.

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But overall, the CEO said the number of disabled rides remained about 10% below pre-pandemic levels.

At the end of the third quarter, Uber had about $13.1 billion invested in other companies, including $4.1 billion in Didi.

Some investors are concerned that Uber holding these investments is sending a message to the market that stakes in other companies are more attractive than putting freed-up capital into Uber's own operations.

Uber's operating business reached profitability on an adjusted profit basis for the first time last quarter, but its stake in Didi generated a net loss of $2.4 billion in the third quarter.

Shares in Didi, which has been stymied by Chinese regulators over an investigation into its data processing practices, are down about 53% from their IPO price on 30 June.

Under pressure from Chinese regulators, Didi said earlier this month that it would leave the US stock exchange and continue listing in Hong Kong.

Didi and Uber, backed by Japanese conglomerate Softbank Group Corp, struck a deal in 2016 in which Uber left the Chinese market and sold its business in China to Didi in exchange for shares.

Uber also holds stakes in Indian food delivery company Zomato, Southeast Asian rival Grab, drone car company Aurora Innovation Inc and others. Softbank also backs Grab and Aurora.