Ride hailing company Uber Technologies Inc. (UBER) will be selling its self-driving unit Uber Advanced Technologies Group (ATG) to autonomous driving startup company Aurora for $4 billion.
Uber believes this deal is good for the company since it will help it achieve its profitability goals. The company’s CEO Dara Khosrowshahi says this move will propel Uber to achieve its profitability on an adjusted basis by the end of 2021.
The CEO however highlighted that Uber’s profitability was not the main factor behind this deal. The CEO will also take a seat in on the board of Aurora after the deal has been closed.
Sources involved with the matter have revealed the deal is valuing ATG at $4 billion. This valuation is much lower comparing to the $7.25 billion valuation the company had last year after securing a $1 billion investment from investors.
After he deal has been closed Uber will thereafter invest $400 million in Aurora leaving the startup with a valuation of $10 billion. In a filling Uber indicates it will own 26% stake in Aurora on a fully diluted basis.