Uber Technologies (UBER) Raises $1.2 Billion Using Unusual Deal Structure

As a display of creative financial mechanisms, Uber Technologies Inc. (NYSE:UBER) raised around $1.2 billion last week through an exchangeable bond deal. So, what’s so interesting? The agreement has a rarely utilized structure where payouts are linked to the company’s stake in Aurora Innovation Inc. (NASDAQ:AUR). As per this structure, these bonds will turn into Aurora equity if the stock exceeds a set price (conversion threshold) after a specified period, which could generate significant value for the bondholders. Conversely, if the stock declines in value, the bondholders get the bond's par value at maturity.

For Uber, which owns around a 20% stake in Aurora, the deal helps it avoid selling its stake probably at a discount, and at a time when Aurora shares are down 40% from their highs reached in February 2025. According to David Hulme, managing director and portfolio manager at Advent Capital Management, the main attraction for the bond investors has been Uber’s investment-grade credit rating and the volatile nature of Aurora stock, which gives them a chance for substantially higher returns. Moreover, Uber’s CEO, Mr. Dara Khosrowshahi, has assured the investors that the company will hold on to its Aurora stake for the foreseeable future.

Uber Technologies Inc. (NYSE:UBER) is a technology platform that utilizes its vast network, cutting-edge technology, and operational expertise to facilitate transportation and logistics services. The company offers ride-hailing, food delivery, and freight transportation, with key segments including Uber Eats for food delivery, Uber Freight for logistics, and advancements in autonomous vehicles and aerial ridesharing.

Aurora Innovation Inc. (NASDAQ:AUR) is a self-driving technology company focused on developing autonomous vehicle solutions for freight and passenger transportation.

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