Vanguard Group and T. Rowe Price Group Inc. marked down the value of their shares of Uber Technologies Inc. by as much as 15 percent following a drumbeat of bad news, lawsuits and boardroom battles at the ride-hailing company.
Vanguard cut the worth of the shares by 15 percent to $41.46 as of June 30 from the prior quarter, according to filings. T. Rowe Price reduced its valuation by about 12 percent to $42.70. BlackRock Inc., the world’s largest asset manager, shaved its estimate less than 1 percent to $53.88 as of June 30 from two months earlier.
Uber’s former chief executive officer Travis Kalanick was ousted in June amid concerns that he had fostered a hostile workplace culture. Uber also faces a lawsuit from Alphabet Inc.’s Waymo unit, which accuses the company of misappropriating driverless technology trade secrets. Uber has denied wrongdoing.
The struggles at Uber, which has been burning through cash, have reached the boardroom. Venture capital firm Benchmark, Uber’s largest shareholder, is suing Kalanick, challenging his control of board seats.
The Wall Street Journal reported on the price cuts earlier today. The Journal also said that the Principal Financial Group Inc.’s mutual funds and Hartford Financial Services Group Inc.’s fund business also reduced price estimates for Uber by 15 percent.
Mutual funds that hold Uber shares must estimate their value each quarter because they don’t trade publicly. Fidelity Investments didn’t change its valuation of Uber as of June 30 from the prior quarter, according to a filing today.
The companies either declined to comment or didn’t respond to requests for comment.
Uber has held up its $69 billion valuation as a sign to employees, partners and prospective competitors that it is a transformational, once-in-a-generation company. Any evidence that Uber might be less valuable than it appears may make it harder for the company to recruit or scare off new competitors.
The mutual fund valuations come as four major investors consider pumping $1 billion to $1.5 billion directly into Uber at the $69 billion valuation, according to people familiar with the matter. In a second part of that deal, the investors are expected to buyout existing shareholders at a discount. That price is still a matter of negotiation.