GM buys shares in SoftBank, a self-driving car unit Cruise

General Motors announced that it will acquire the shares of SoftBank Vision Fund LP in the cruise division for $ 2.1 billion, about four years after a Japanese investment company bets on self-driving car technology to join the automaker.

GM also said on Friday that it would make an additional $ 1.35 billion investment in GM Cruise Holdings LLC in place of its previous commitment from SoftBank.

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GM’s Cruise will be about 80% owned, and once the transaction is completed, SoftBank will no longer own Cruise and will no longer have any rights to Cruise.

File Photo: Self-driving GM Bolt EV is seen at a media event where GM’s self-driving car unit Cruise unveiled its self-driving car in San Francisco, California. REUTERS / Elijah Nouvelage (Reuters)

Investors speculate that GM will be able to spin off Cruise for years, and some analysts said the sudden resignation of Cruise CEO Dan Ammann in December was longer than GM expected in the company. I am wondering if it was a signal that I wanted to continue the business.

GM CEO Mary Barra recently said Detroit carmakers want to continue refining their technology and plans for the future robotic taxi business before deciding on the future of their cruises. future.

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“There’s still a lot to do,” she said at an investor conference last month. “We can move faster rather than seeing a specific opportunity right now.”

San Francisco cruise self-driving car. (Andrej Sokolow / dpa / Reuters Photos)

Like many unmanned vehicle developers, Cruise has recently postponed commercialization plans to improve its self-driving capabilities. In October, Cruise announced plans to deploy thousands of robotic taxis across US cities over the next few years. Cruise said it could generate $ 50 billion in revenue by the end of the decade.

Softbank held a 19.6% stake in Cruise after investing $ 2.25 billion in July 2018. Since then, Cruise has been a newly established entity primarily composed of Cruise Automation, an unmanned driving developer acquired by GM in early 2016.

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“Cruise will continue to operate as it does today. It’s an independent company that works with GM to build flexible partnerships,” Cruze CEO Kyle Vogt said in a statement. Cruise founder Vogt was appointed CEO last month.

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Also on Friday, Cruise said it had established a program that would give employees the opportunity to sell their stake in the company quarterly. This is a move aimed at maintaining and attracting talent.

In a blog post, Vogt wrote that the so-called regular liquidity opportunity program “provides employees with liquidity and potential benefits like an IPO, but is not distracted by being a public company.” Said.

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Investment trust companies T. Rowe Price Associates Inc. and Honda Motor Co. have also invested in Cruise.

Write to Denny Jacob (denny.jacob@wsj.com) and Mike Colias (Mike.Colias@wsj.com).

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