Japan’s SoftBank Group Corp has agreed to invest $2.25 billion in GM Cruise Holdings LLC which is the autonomous vehicle unit of the U.S. based car maker, said General Motors Co on Thursday which could significantly hasten the wide-scale deployment of self-driving cars, said the company.
There was a rise of 10 per cent in the shares of GM following the announcement in pre-market trade.
This is being touted as the largest ever investment made in the segment of autonomous vehicles. The $100 billion investment fund of SoftBank - the Vision Fund, would be the source of the funding and will allow GM massive scale deployment of self-driving vehicles, said GM President Dan Ammann at GM headquarters in Detroit in a media briefing early on Thursday.
The company is still “on track” to start the deployment5 of its Cruise AVs in commercial ride sharing fleets by 2019, said Chief Executive Officer Mary Barra.
The company also said that the unit will also see an investment of $1.1 billion by GM following the closure of the deal.
Following the completion of the transaction, 19.6 percent stake in GM Cruise would be owned by SoftBank Vision Fund.
Michael Ronen, managing partner of SoftBank Investment Advisers that the companies have come to an agreement of not cashing out their investments from the Cruise unit for a period of at least 7 years.
However, a question about whether GM has any plans for the spinning off of GM Cruise Holdings as a separate company was evaded by Barra and only said that the company would “do what’s best for shareholders.”
Another question targeted at Ronen where he was asked about the possibility of SoftBank consolidating the huge investments that it has made in some of the largest ride services companies in the world that includes the likes of Uber, Didi, Ola and Grab was also avoided where he said that each of the companies was responsible for such decisions.
A significant stake in Uber rival Lyft is held by GM.
The timing of the investment form SoftBank is significant because there are some other companies such as rivals Tesla Inc, Alphabet Inc’s Waymo unit and Uber Technologies Inc that have renewed their efforts in the autonomous vehicle segment to become the early bird and take advantage of the first movers in the market.
It was just recently that GM set up the GM Cruise Holdings unit and Strobe, a small firm that develops self-driving sensor and was acquired by Cruise last year, and Cruise Automation, which leads the self-driving vehicle development of GM and is based in San Francisco, are among the assets of the Cruise. Ever since the acquisition of Cruise Automation in early 2016 for a deal estimated to be worth $1 billion, GM – the largest U.S. automaker, has been focused of rolling out self-driving cars because the company believes that the electric and autonomous vehicle segment is the key for future growth of the company.
(Source:www.reuters.com)
There was a rise of 10 per cent in the shares of GM following the announcement in pre-market trade.
This is being touted as the largest ever investment made in the segment of autonomous vehicles. The $100 billion investment fund of SoftBank - the Vision Fund, would be the source of the funding and will allow GM massive scale deployment of self-driving vehicles, said GM President Dan Ammann at GM headquarters in Detroit in a media briefing early on Thursday.
The company is still “on track” to start the deployment5 of its Cruise AVs in commercial ride sharing fleets by 2019, said Chief Executive Officer Mary Barra.
The company also said that the unit will also see an investment of $1.1 billion by GM following the closure of the deal.
Following the completion of the transaction, 19.6 percent stake in GM Cruise would be owned by SoftBank Vision Fund.
Michael Ronen, managing partner of SoftBank Investment Advisers that the companies have come to an agreement of not cashing out their investments from the Cruise unit for a period of at least 7 years.
However, a question about whether GM has any plans for the spinning off of GM Cruise Holdings as a separate company was evaded by Barra and only said that the company would “do what’s best for shareholders.”
Another question targeted at Ronen where he was asked about the possibility of SoftBank consolidating the huge investments that it has made in some of the largest ride services companies in the world that includes the likes of Uber, Didi, Ola and Grab was also avoided where he said that each of the companies was responsible for such decisions.
A significant stake in Uber rival Lyft is held by GM.
The timing of the investment form SoftBank is significant because there are some other companies such as rivals Tesla Inc, Alphabet Inc’s Waymo unit and Uber Technologies Inc that have renewed their efforts in the autonomous vehicle segment to become the early bird and take advantage of the first movers in the market.
It was just recently that GM set up the GM Cruise Holdings unit and Strobe, a small firm that develops self-driving sensor and was acquired by Cruise last year, and Cruise Automation, which leads the self-driving vehicle development of GM and is based in San Francisco, are among the assets of the Cruise. Ever since the acquisition of Cruise Automation in early 2016 for a deal estimated to be worth $1 billion, GM – the largest U.S. automaker, has been focused of rolling out self-driving cars because the company believes that the electric and autonomous vehicle segment is the key for future growth of the company.
(Source:www.reuters.com)
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