Uber offered shares to media barons for political help, leak reveals

 

Uber offered shares to media barons for political help, leak reveals

 

Tech firm wooed owners of publications in Europe and India as it sought favourable treatment from governments, documents show

 

Felicity Lawrence

Mon 11 Jul 2022 17.00 BST

https://www.theguardian.com/news/2022/jul/11/uber-offered-shares-to-media-barons-for-political-help-leak-reveals

 

Uber courted leading media barons across Europe and India with the aim of using their clout to secure more favourable treatment from governments, leaked documents reveal. It asked existing media investors to lobby on its behalf and offered others prized stakes in the company.

 

The tech company’s charm offensive targeted the owners of publications including the UK’s Daily Mail, France’s Les Echos, Italy’s La Repubblica and L’Espresso, Germany’s Die Welt and Bild and the Times of India. The German deal was discussed internally as a way of gaining political “support and influence” in Germany and Brussels, according to the Uber files, a leak of more than 124,000 documents to the Guardian.

 

In the winter of 2015-16 the company did what it called a “cash plus media for equity” deal with the leading newspaper publisher Axel Springer, the owner of Die Welt and Bild, selling a $5m stake. The arrangement was not made public until 2017. Uber also announced a similar partnership with Bennett, Coleman & Co, the owner of the Times of India group, in early 2015.

 

Documents show that for Uber, cash was secondary to the media companies’ influence in the corridors of power. Uber was facing bans in both countries at the time of the deals: in Germany it was accused of operating unlawfully in major cities and in India its licence had been suspended following a notorious case in 2014 in which an Uber driver raped a passenger.

 

Uber also called on the clout of one of its early investors, the Italian industrial and media magnate Carlo De Benedetti, to help gain access to the then prime minister, Matteo Renzi, when legislation affecting the taxi market was being considered in early 2016, the Uber files reveal. De Benedetti was the publisher of the influential daily La Repubblica and the news weekly L’Espresso at the time, titles he has since sold.

With investors queueing up to put money into the company before its stock market flotation, Uber executives discussed attracting those who brought more than simply money to the table. It was media barons’ political influence rather than preferential editorial coverage that Uber sought.

 

Mark MacGann, Uber’s former European policy head, said: “We didn’t really need the money, we believed we were doing them a favour by taking their money, because we wanted the top-level political access and influence that came with the money.”

 

Leaked documents reveal how in December 2015, a senior Uber executive emailed its communications chief, Rachel Whetstone, about discussions with Axel Springer: “They are very interested in a small (ie $5m) media plus cash for equity deal … For us the key value here would be their support and influence in Germany and Brussels.

 

“They claim to have done a lot to help [another tech company] with policy in Germany and are going to send examples.”

 

Whetstone replied: “I think having Springer onside is very valuable if we are to make progress in Germany. They have traditionally been somewhat close to Taxi. So anything we could do to work with them would be great … I believe they will actually do things proactively to help – along the lines of De Benedetti.”

 

Uber’s chief executive, Travis Kalanick, was given a prominent platform to speak at an annual conference for business leaders in June 2016 organised by the upmarket daily Die Welt.

 

In France, when Uber was facing regulatory obstacles in early 2015, it courted the billionaire owner of the luxury goods corporation LVMH, Bernard Arnault. LVMH is the parent company of the French financial daily Les Echos.

 

Documents show MacGann wrote to another senior Uber executive: “So I brokered the investment meeting for TK [Travis Kalanick] and Bernard Arnault in Paris, since we are courting Arnault as a strategic investor in order to get him to influence the French regulatory situation.”

 

A third Uber executive wanted assurance that Arnault would bring in more than just money. “If we do this guys we either need some believable assurance from Arnault that they’ll lobby on our behalf or we think about some conditions,” he emailed.

 

Arnault, one of the world’s richest men, went on to invest $5m personally. He did not respond to requests for comment about any role he may have played in helping Uber.

 

The Times of India group offered a public relations opportunity around the time its deal with Uber was being finalised. The editor-in-chief of its English-language daily the Economic Times, Rahul Joshi, offered Kalanick the podium at the Global Business Summit it was hosting in January 2015.

 

Joshi invited Kalanick to put forward the case for “new regulations for new-economy companies”, saying that members of Narendra Modi’s cabinet would be there to hear him. Kalanick decided it did not suit his schedule, but said in an email to colleagues that the relationship with the Times of India was important.

 

That media deal came with Uber under intense pressure after one of its drivers raped a 26-year-old woman in Delhi in December 2014, and it was accused of conducting weak background checks on workers. Uber was allowed to resume operating in Delhi in late January 2015, having agreed to do more safety checks.

 

The Times of India’s chair, Sivakumar Sundaram, denied the company had facilitated any form of political access or efforts to change legislation for Uber. The investment partnership related purely to advertising and marketing, he said, and had no influence whatsoever on its journalism. “Uber functionaries being part of any business summit has no relationship with the Times Group’s journalism,” he added.

 

In Italy, De Benedetti hosted Uber’s vice-president for policy, the former Obama campaign manager David Plouffe, along with MacGann and Uber Italy’s general manager for dinner at his grand private residence in Rome in September 2015. Uber’s lobbying effort was called “Italy-Operation Renzi” in internal emails.

 

The billionaire publisher was reported to be “committed and supportive” in email exchanges, and was said to have facilitated Uber’s operation targeting Renzi and his Democratic party. In the Uber files, executives said De Benedetti emailed and contacted a close ally and key minister in Renzi’s government on WhatsApp to say Uber was “unstoppable” and a symbol of modernity that they should support when laws were being changed.

 

In autumn 2014 Uber executives also discussed Kalanick making time for media investors in the UK on a planned European tour. These included the Daily Mail group’s owner Lord Rothermere.

 

Rothermere went on to meet Kalanick in January 2015 at a dinner hosted by the German media magnate Hubert Burda in the Residenz, a former royal palace in Munich, the Uber files show.

 

Kalanick was attending Burda’s annual invitation-only conference for tech entrepreneurs. The meeting was a fleeting conversation before dinner during which Kalanick outlined difficulties Uber was facing in London with the mayor, Boris Johnson, and Transport for London (TfL). Kalanick indicated he would like Rothermere, as an Uber investor, to use his political influence to help, according to MacGann, who was present. Rothermere, who is understood to have sold his Uber stake, declined to comment.

 

De Benedetti confirmed he had hosted Plouffe and other Uber executives, and said he did so “as a courtesy” to a banker friend who had recommended the Uber investment to him, but denied he had ever undertaken any lobbying with or for the company.

 

Renzi’s office said that as prime minister he had no authority over regulating cabs since that fell to independent institutions with whom he “had no leeway to meddle”.

 

Uber said it “sought out strategic investors who could help us understand certain markets and grow our business”. It added: “In some cases, that included media organisations who were making similar investments in other companies. We never presumed that we would receive favourable coverage – in fact, it’s fair to say we have received lots of critical coverage from all of the outlets mentioned below many, many times.” Lawyers for Whetstone said she did not play a key role in bringing in strategic investors, a policy which was well established before she joined Uber.

 

A spokesperson for Axel Springer said the stake in Uber was in exchange for advertising space in its publications and was too small to merit being announced at the time. Kalanick was just one of many people who spoke at the Die Welt conference. The editorial departments operated completely independently and had featured negative as well as positive coverage of Uber, he added.

 

Kalanick’s lawyers did not respond to specific questions about Uber’s strategic investors.