Travis Kalanick names 2 directors without consulting Uber board
Reuters|
Updated: Oct 01, 2017, 11.39 PM IST
SAN FRANCISCO: Uber Technologies co-founder Travis Kalanick said he had appointed two new directors, a surprise move that publicly reignited a board battle over the role of the ousted former chief executive. Kalanick’s move on Friday sought to pre-empt a move by new chief executive Dara Khosrowshahi to restructure the board and gain greater control, a person familiar with the co-founder’s decision said.
Uber said in a statement on Friday the company was surprised by Kalanick’s action. Company investors are divided over whether Kalanick should remain on the board and whether he should be allowed to name two other directors. Benchmark Capital, which had pressured Kalanick to resign as CEO in the wake of several governance scandals, did not respond to a request for comment.
Khosrowshahi is scrambling to portray Uber as a reformed company that is turning a page on concerns including sexual harassment claims and a US bribery probe. Investors have described diluting Kalanick’s power as a necessary step on the path to making amends.
Kalanick, still one of the largest shareholders, said in a statement he had appointed former Xerox chief executive Ursula Burns and former Merrill Lynch chief executive John Thain as directors. “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.
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,” he said. He did not specify the proposals he opposed. Uber had nine directors before Kalanick’s Friday appointments.
The person familiar with the matter said that Kalanick acted after Khosrowshahi had outlined a plan to directors, which is scheduled to be voted on October 3 that would give him control of four board seats in addition to his own on a panel that now has 11 directors. Khosrowshahi’s plan cal ls for transferring one of the two Kalanick-controlled positions to SoftBank Group, which is considering an investment in Uber, the source said.
Khosrowshahi effectively could put a person of his choosing in the other seat, as well as three other existing ones, according to the source. A third of directors also would be elected each year under the plan.
Uber said in a statement on Friday the company was surprised by Kalanick’s action. Company investors are divided over whether Kalanick should remain on the board and whether he should be allowed to name two other directors. Benchmark Capital, which had pressured Kalanick to resign as CEO in the wake of several governance scandals, did not respond to a request for comment.
Khosrowshahi is scrambling to portray Uber as a reformed company that is turning a page on concerns including sexual harassment claims and a US bribery probe. Investors have described diluting Kalanick’s power as a necessary step on the path to making amends.
Kalanick, still one of the largest shareholders, said in a statement he had appointed former Xerox chief executive Ursula Burns and former Merrill Lynch chief executive John Thain as directors. “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.
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,” he said. He did not specify the proposals he opposed. Uber had nine directors before Kalanick’s Friday appointments.
The person familiar with the matter said that Kalanick acted after Khosrowshahi had outlined a plan to directors, which is scheduled to be voted on October 3 that would give him control of four board seats in addition to his own on a panel that now has 11 directors. Khosrowshahi’s plan cal ls for transferring one of the two Kalanick-controlled positions to SoftBank Group, which is considering an investment in Uber, the source said.
Khosrowshahi effectively could put a person of his choosing in the other seat, as well as three other existing ones, according to the source. A third of directors also would be elected each year under the plan.
