General Motors is acquiring SoftBank’s stake in Cruise and pouring even more money into the self-driving unit it purchased in 2016. The auto giant has announced that it’s buying out SoftBank Vision Fund 1’s equity ownership into the company that’s worth $2.1 billion. In addition, it has committed to investing an extra $1.35 billion in Cruise to replace the funding SoftBank promised in February after the self-driving car company started offering robotaxi rides in San Francisco.
The automaker didn’t say why it’s buying SoftBank’s equity ownership, but GM chief executive Mary Barra said:
“Our increased investment position not only simplifies Cruise’s shareholder structure, but also provides GM and Cruise maximum flexibility to pursue the most value-accretive path to commercializing and unlocking the full potential of AV technology.”
SoftBank, meanwhile, has recently struggled with debt and the plummeting value of its properties. It may no longer be interested in an investment that won’t field returns anytime soon. In February, SoftBank CEO Masayoshi Son said the company would sell “a good chunk of assets” after ARM’s multi-billion sale to NVIDIA fell through.
As TechCrunch notes, GM could have also bought out SoftBank as a step towards spinning out Cruise or taking it public. A GM spokesperson told the publication that the automaker will “consider all opportunities to create value for [its] shareholders” and that it “has not ruled out a future IPO of Cruise.”
The California Public Utilities Commission recently granted Cruise (and Waymo) permission to charge for robotaxi rides in the state, as long as there’s a human driver behind the wheel. Cruise already applied for a Driverless Deployment permit, but the agency is still reviewing its application.
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