PHOTO: Eric Piermont/AFP/Getty Images
Former Uber CEO Travis Kalanick on Friday unilaterally appointed two new members to the board of directors in a surprise move that increased tension within the leadership of the popular ride service.
Kalanick, who was pressured to resign in June as head of Uber which dominates the market for smartphone on-demand car rides, retains sizeable voting rights in the privately-held company that he co-founded.
On Friday, he appointed former Xerox Chairman and CEO Ursula Burns and former CEO of CIT Group, Merrill Lynch, and the New York Stock Exchange John Thain to the board.
The appointments came ahead of a board vote next week on reducing Kalanick’s voting power, US media reported.
“Ursula and John are two highly-accomplished corporate leaders with extensive board experience,” Kalanick said in a statement.
“I am appointing these seats now in light of a recent Board proposal to dramatically restructure the Board and significantly alter the company’s voting rights,” he said.
“There is no doubt the board will be well-served by their valuable insights, counsel and independent perspective as Uber moves into the next phase of growth and prepares for a public offering.”
The board was not consulted about the appointments.
“The appointments of Ms. Burns and Mr. Thain to Uber’s Board of Directors came as a complete surprise to Uber and its board,” the company said in a brief statement.
“That is precisely why we are working to put in place world-class governance to ensure that we are building a company every employee and shareholder can be proud of.”
The news was first reported by the Wall Street Journal and the online site Recode.
Uber’s board of directors is split between detractors and supporters of Kalanick, who had been the driving force behind the company’s massive global expansion but whose brash style made him a liability.
Tensions appeared to subside in August with the appointment of Dara Khosrowshahi, former boss of the global travel giant Expedia, as the new Uber head.
– Tough times –
Kalanick’s move is a finger in the eye of major Uber investor Benchmark Capital, which earlier filed a civil lawsuit accusing him of fraud, breach of contract and of plotting to manipulate the board of directors to allow him to return as CEO.
The move also comes as the Japanese group SoftBank is reportedly finalizing a deal to invest up to $10 billion in Uber — a move, according to the Wall Street Journal, opposed by Benchmark Capital.
Uber, which has accumulated financial losses, has been caught up in a whirlwind of controversy in recent months, facing allegations of sexual harassment, theft of technology, corruption and the use of illegal software.
At the same time, its drivers have been struggling with a wave of opposition from traditional taxis in several countries.
Uber is also facing fierce opposition from various regulators, most recently in London where officials have refused to renew its license.
Uber drivers have also been pressing for better pay and benefits befitting employees instead of contract workers.