Having started out with a bang and as a pioneer in the technology and internet applications world, Yahoo finally had to wind up and ends its run as a mere holding company. And some analysts and market experts predict that the trendsetting ride hailing company Uber Technologies could also be embarking on the same path as Yahoo.
The market value of Yahoo has at one time soared beyond $100 billion during the heady days of the company at 1999. And for a value of a mere $4.5 billion, the last vestiges of its online business were offloaded to Verizon Communications by the company last month. And along with about $11 billion of net cash, stakes acquired long ago in Jack Ma’s Chinese e-commerce goliath Alibaba and Yahoo Japan are all that is left of the company under the rebranded $56 billion Altaba.
Meanwhile, on top of a workplace-culture fiasco that has left the company, there are several legal and regulatory roadblocks that are piling up for Uber. And without its co-founder and chief executive, Travis Kalanick, among other senior-level gaps, this ride hailing application owner was last valued at some $68 billion. Uber has begun rounding up positions in some promising far-flung markets, too, as it struggles to preserve its app-driven ride service and build fledgling logistics and autonomous-vehicle businesses.
Last year, a mere 18 percent stake in rival Didi Chuxing was what the company transformed its cash-burning Chinese operation into. But based on a recent $5.5 billion Didi fundraising that valued the whole company at $50 billion, that stake alone is worth around $8 billion. And by abandoning cutthroat competition with local rival Yandex in favor of 37 percent ownership in a new combined service, Uber did something similar in Russia earlier this month. That stake was initially valued at well over $1 billion. About $10 billion is the value that the two interests add up to approximately.
On the other hand, there is a continuous decline in the overall worth of Uber. According to TechCrunch, it dipped to $50 billion in June on the secondary market. And if it’s still falling following Kalanick’s ouster, analysts would probably not be surprised.
Lyft, Uber’s primary U.S. rival, was valued at $7.5 billion during a new fundraising in April for the former. And supposing that its China and Russia stakes soon appreciate by 50 percent and Uber’s larger American business is worth twice that. Uber would add up to a $30 billion company, with half the value already accounted for by minority interests, even after ignoring Uber’s efforts in other countries, some of which eventually could become additional stakes. And therefore it’s not hard to see Uber becoming the next Altaba if those figures are extrapolated for a few more years.
(Adapted from Reuters)