The deal is designed to help Uber's freight arm break even more quickly, the San Francisco-based company said in a statement. Uber Freight will turn its first adjusted earnings before interest, taxes and other expenses by the end of next year, the parent company said. The unit generated $995 million in revenue last year.
TPG will receive as much as $750 million in Uber stock and the rest in cash. The transaction is expected to close this year or in the first half of 2022, according to a company presentation.
With Transplace, Uber Freight will expand beyond brokering loads between shippers and truckers and into more complete management of a company's logistics needs, said Lior Ron, head of Uber Freight. Those added services fit with Uber's recent push into last-mile delivery of food and packages, he said.
'It's about bringing an end-to-end supply-chain offering from the first mile to the middle mile to the last mile and doing that globally,' he said in an interview. 'That's the focus.'
Uber's relationship with TPG dates back to at least 2013, when the private equity firm made an early investment in the ride-hailing company. Uber moved into trucking after acquiring Otto, a start-up developing technology for self-driving trucks. That transaction, which took place in 2016, landed Uber in a contentious battle with Alphabet Inc's Waymo over allegations that the technology was based on stolen trade secrets.
Last year, Uber offloaded the autonomous driving business but kept freight. Uber Freight pairs trucking companies with those seeking to transport loads. Uber said this month that it's expanding to smaller freight loads. The latest deal signals the importance of this often-overlooked part of Uber's business.
Uber expects to apply its expertise on data science, marketplaces and machine learning to enhance Transplace's technology, making shippers and truckers more efficient, Mr Ron said. Uber Freight has, for example, used such tools to cut in half the number of empty trailers that are hauled back, he said.