As part of the deal, Uber's board agreed to carry out a set of sweeping governance changes, including measures that reduce the influence that Travis Kalanick, Uber's former chief executive, has at the company. "Upon closing, it will help fuel our investments in technology and our continued expansion at home and overseas, while strengthening our corporate governance".
Although Uber had not elaborated on plans of the investment, the deal reportedly includes a $1 billion investment in the company.
Uber, in a statement to Reuters on Tuesday, confirmed Kohli had quit. The agreement will not only give SoftBank a major stake in Uber - it is looking to buy up at least 14 per cent of the company - but it will help put a rest to one of the many ongoing battles for new CEO Dara Khosrowshahi. Some of Uber's early investors, like the venture capital firm Benchmark, initially wanted to retain certain shareholder rights that they hold through their Uber stock, according to two of the people briefed on the discussions.
Completing the SoftBank deal would allow Uber to open a new chapter after a year of controversy, including the resignation of Kalanick, the ouster of several top executives, sexual harassment and discrimination allegations, and multiple federal criminal probes. The terms were signed on Sunday, although the tender offer would likely take weeks to complete. SoftBank plans to buy about $1 billion of fresh stock at Uber's current valuation of about $68.5 billion, but the bulk of the deal will be purchasing existing Uber shares from current investors.
SoftBank also owns pieces of ride-hailing companies around the world, including Didi Chuxing in China, Ola in India, Grab in Southeast Asia and 99 in Brazil.
"Uber had a remarkable first six or seven years, a bumpy past two years, and now the SoftBank deal allows for a full reset", said Bradley Tusk, an Uber investor and political strategist who works with tech companies.
In turn, Kalanick must receive majority board approval should he want to replace the board seats over which he has control, according to the source.
Softbank has yet made no comments on the deal.
Uber's use of software aimed at thwarting rivals like Lyft has also hurt its image, and could create further legal woes.