Uber Prices IPO at $45 as SF Supervisor Proposes Tax - NBC Bay Area
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Uber Prices IPO at $45 as SF Supervisor Proposes Tax

The demonstrations did not seem to cause much disruption and many riders were still able to hail a car with ease

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    Uber Prices IPO at $45 as SF Supervisor Proposes Tax

    San Francisco-based Uber about to embark on a wild ride on Wall Street with the biggest and most hotly debated IPO in years. Scott Budman reports. (Published Thursday, May 9, 2019)

    San Francisco-based Uber is about to embark on a wild ride on Wall Street with the biggest and most hotly debated IPO in years.

    The world's leading ride-hailing service set the stage for its long-awaited arrival on the stock market by pricing its initial public offering at $45 per share late Thursday. At the same time, a member of the San Francisco Board of Supervisors has proposed a tax on corporate IPO wealth in order to address income inequality.

    Supervisor Gordon Mar suggests restoring the 1.5% tax on stock-based compensation, the same rate corporations used to pay before 2012 when the city began offering tax breaks, according to his spokesperson. The ordinance was co-sponsored by six other supervisors and President Norman Yee.

    Uber now has a market value of $82.4 billion — significantly more than century-old automakers General Motors and Ford Motor.

    Uber, Lyft Drivers Protest in Cities Across the US, Overseas

    [BAY] Uber, Lyft Drivers Protest in Cities Across the US, Overseas

    Some drivers for ride-hailing giants Uber and Lyft turned off their apps Wednesday to protest what they say are declining wages at a time when both companies are raking in billions of dollars from investors. Scott Budman reports.

    (Published Wednesday, May 8, 2019)

    The IPO raised another $8.1 billion for Uber as it tries to fend off rival Lyft in the U.S. and help cover the cost of giving rides to passengers at unprofitable prices. The San Francisco company already has lost about $9 billion since its inception and acknowledges it could still be years before it turns a profit.

    Uber will face its next test Friday when its shares begin trading the New York Stock Exchange. And Mar's proposal will go to the Rules Committee before being voted on by the all the city supervisors. 

    No matter how the Uber's stock swings, the IPO has to be considered a triumph for the company most closely associated with a ride-hailing industry that has changed the way millions of people get around while also transforming the way millions of more people earn a living in the gig economy.

    That sobering reality is one reason that Uber fell well short of reaching the $120 billion market value that many observers believed its IPO might attain earlier this year.

    Another factor working against Uber is the cold shoulder that investors have been giving Lyft's stock after an initial run-up. Lyft's shares closed Thursday 23% below its IPO price of $72. The jitters about an intensifying U.S. trade war with China also have roiled the stock market this week.

    Despite all that, Uber's IPO is the biggest since Chinese e-commerce giant Alibaba Group debuted with a value of $167.6 billion in 2014.

    Uber, Lyft Drivers Protest in Cities Across the US, Overseas

    [BAY] Uber, Lyft Drivers Protest in Cities Across the US, Overseas

    Some drivers for ride-hailing giants Uber and Lyft turned off their apps Wednesday to protest what they say are declining wages at a time when both companies are raking in billions of dollars from investors. Pete Suratos reports.

    (Published Wednesday, May 8, 2019)

    Meanwhile, scores of Uber drivers say they have been mistreated by the company as they work long hours and wear out their cars picking up passengers as they struggle to make ends meet.

    Uber may be able to avoid Lyft's post-IPO stock decline because it has a different story to tell other than the potential for growth in ride-hailing, says Alejandro Ortiz, principal analyst with SharesPost. Uber, he said, has plans to be more than a ride-hailing company by being all things transportation to users of its app, offering deliveries, scooters, bicycles and links to other modes of transportation including public mass transit systems.

    "Whether or not that pitch will work kind of remains to be seen. It's nearly impossible to tell now," he said. "Obviously the risk to the company now is they have a lot more shareholders that they have to convince."

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