[By Molly Schuetz]
Goldman Sachs Group Inc. has sold off its stake in Uber Technologies Inc. after the ride-hailing startup’s disappointing initial public offering in 2019.
Chief Financial Officer Stephen Scherr said on the bank’s earnings call Wednesday that it closed its position in Uber in the fourth quarter last year.
Goldman owned about 10 million shares of Uber at the time of the IPO, turning a $5 million wager using the firm’s own money back in 2011 into a major windfall. The bank recognized a gain in the second quarter, but took a hit in the third quarter as Uber’s shares plunged. Like other investors, Goldman Sachs was restricted from selling shares until six months after the offering.
Goldman lost out to Morgan Stanley as lead banker on Uber’s IPO, one of the most highly-anticipated in 2019, though it did share some of the work along with Bank of America Corp. But Uber’s shares tumbled immediately after the listing and ended the year down 34% as investors questioned its path to profitability and regulatory challenges and controversies about passenger safety and the rights of drivers weighed on the company’s image.
Uber has said it plains to be profitable on an Ebitda basis in 2021 and its shares are up about 18% so far this year.