- Softbank will invest $1B in Uber at a $69B valuation - this is the same as their old valuation. This sale will create new shares and therefore dilution.
- However, the offer is contingent on Softbank being able to buy a significant number of pre-existing shares at a $48B valuation from early investors - no dilution here.
- If they don't get enough investors to agree to sell at $49B then the whole deal is off the table.
When you spend on old, someone with no further interest in Uber has money in their pocket.
When you create new ones, you've just injected money into Uber, which increases its likelihood of survival.
If they are buying enough to get control, they can now choose to spend that $1 billion in ways that channel money back into other companies that they own. Thereby further reducing the cost to them of providing that money. (Presumably, though, the money channeled back will be for products that help Uber. This looks like a shell game but isn't.)
https://www.bloomberg.com/view/articles/2017-11-16/softbank-...