Uber’s boardroom warfare continues: Vote would further hobble Travis Kalanick

The soap opera that is the Uber story continues Tuesday, when a deeply fractured and openly hostile board reportedly votes on measures intended to further cut the power of its ousted CEO.

Proposed board reforms would limit former chief executive Travis Kalanick’s influence as a board member and shareholder, make it more difficult for him to ever return as CEO, give all shareholders equal voting power and move Uber toward an IPO in the next two years, Bloomberg reports. The board is also expected to discuss a proposed $10 billion stock sale to SoftBank

This latest wave of drama started late Friday, when Kalanick — kicked out by the board in June — made a surprise announcement. The ousted executive said he had appointed two new members to Uber’s board: former Xerox CEO Ursula Burns and former Merrill Lynch CEO John Thain. The move was seen as a slap in the face to the rest of the ride-hailing company’s executives and board, who apparently weren’t consulted before the important decision was made.

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“The appointments of Ms. Burns and Mr. Thain to Uber’s Board of Directors came as a complete surprise to Uber and its Board,” a company spokesman wrote in a statement emailed to SiliconBeat. “That is precisely why we are working to put in place world-class governance to ensure that we are building a company every employee and shareholder can be proud of.”

It also was a blow to Uber’s new chief executive, Dara Khosrowshahi.

The new CEO called the move by his predecessor “disappointing” in an internal email to employees, Bloomberg reports. He wrote: “Travis appointed two new members to Uber’s Board without discussing it with me or the Board of Directors more broadly. Anyone would tell you that this is highly unusual.”

In a statement emailed to SiliconBeat via his spokesman, Kalanick said it was important to appoint the new board members when he did.

“I am appointing these seats now in light of a recent Board proposal to dramatically restructure the Board and significantly alter the company’s voting rights,” he wrote. “It is therefore essential that the full Board be in place for proper deliberation to occur, especially with such experienced board members as Ursula and John.”

“I am confident that, with their additions and Dara’s appointment,” he continued, “Uber will be well situated to focus on the future and continue to revolutionize how cities move.”

Meanwhile, Kalanick is fighting a lawsuit brought by his high-profile investors at Benchmark, who sued him for fraud over the summer. The investors are attempting to snatch Kalanick’s board seat and prevent him from appointing his allies to the board (it’s unclear what will happen now that Kalanick already has appointed two new members). That suit is proceeding in private arbitration after a judge removed it from open court.

Photo: Uber CEO Travis Kalanick talks to the media at the 2016 Breakthrough Prize awards ceremony at NASA Ames Research Center in Moffett Field on Nov. 8, 2015. (Josie Lepe/ Bay Area News Group)

 

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