• Uber has announced it has sold a $500 million stake in its Uber Freight logistics business to New York-based private equity firm Greenbriar Equity Group.
  • Uber will retain majority ownership of Uber Freight.
  • The investment values the logistics arm of the company at $3.3 billion on a post-money basis.
  • Visit Business Insider’s homepage for more stories.

(Reuters) – Uber Technologies Inc said on Friday New York-based private equity firm Greenbriar Equity Group would invest $500 million in its logistics arm, Uber Freight, valuing the unit at $3.3 billion on a post-money basis.

The ride-hailing firm said it would maintain majority ownership of Uber Freight, and use the funds to scale its logistics platform and increase product innovation.

Unlike Uber’s ride-hailing app or its food-delivery service, Uber Freight operates as a middle man in the fragmented long-haul trucking business, connecting truckers with shippers.

Michael Weiss and Jill Raker, managing partners of Greenbriar, will join Uber Freight’s board, the companies said in a statement.

(Reporting by Ayanti Bera in Bengaluru; Editing by Aditya Soni)

Axel Springer, Insider Inc.’s parent company, is an investor in Uber.

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Uber Technologies Inc.

is selling a stake in its Uber Freight truck brokerage arm for $500 million to investors in a funding round led by Greenbriar Equity Group LP, pumping fresh cash into a business that has been growing rapidly while also losing money at a fast clip.

The planned investment comes as the coronavirus pandemic has hammered Uber’s core ride-hailing business, prompting the company to slash jobs and re-evaluate cash-burning businesses such as Freight, which accounts for a small portion of Uber’s overall revenue.

The new investors are coming in through what Uber Freight says is a Series A preferred stock financing. The investment values the business at $3.3 billion after the funding round.

Two managing partners at Greenbriar, a Rye, N.Y.-based midmarket private-equity firm focused on logistics and transportation, will join Uber Freight’s board of directors as part of the deal, which Uber said was expected to close this month.

Uber declined to name the other investors.

The transaction would provide Uber with an infusion of capital as the company pushes to cut costs and complete a $2.65 billion all-stock deal to acquire food-delivery rival Postmates Inc. that is expected to close next year.

It would give Uber Freight the benefit of Greenbriar’s logistics expertise as it scales up its digital freight operation, which uses technology to match truckers with shippers who need to move cargo.

“This significant statement of commitment is clearly saying we’re here for the long run,” Lior Ron, head of Uber Freight, said in an interview. “This is the next chapter for us.”

Uber Freight has grown rapidly in recent years, rolling out new logistics services as it gains market share from