"We should break even in three years" says Uber

13 Oct 2018


Ride-sharing giants Uber are currently marketing their first ever high yield bond to a select group of investors as part of a private offering, according to a report in Forbes

In finance, a high-yield bond is a bond that is rated below investment grade. These bonds have a higher risk of default or other adverse credit events, but typically pay higher yields than better quality bonds in order to make them attractive to investors. 


If the deal was to go through, it would be worth $1.5 billion, which would take Uber’s available liquidity to around the $10 billion mark.

Uber has said it expects to spend $3 billion this year as it continues to heavily invest in assisting its rapid growth.

According to sources, during their pitch to investors, Uber executives said the company is likely to generate between $10-$11 billion of revenue this year but it would book negative figures of around $2 billion.

They believe that the company should reach “break-even” levels in around three years time.

According to the report, the potential “dept investors”, who usually stay clear of companies that don’t generate positive cash flow to pay interest on their debts, are keen on a deal, saying:

“The initial bond deals for other tech darlings went well. I would suspect this one for Uber will go even better.”

Pricings, which are expected next week, would also be seen as a very attractive deal for the investors, with the company looking to price the deal with interest rates in the region of 7.5% for the $500 million five-year tranche and 8% for the $1 billion eight-year portion.

Uber is currently a private company but has said for some time now that it hopes to go public in 2019.  

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