Sources: Uber increased amount sought for line of credit to $2B from $1B, after more banks wanted in, and is finalizing the deal
Uber Finalizing $2 Billion Line of Credit — Uber originally only sought a $1 billion facility, but more banks wanted in — Uber Technologies Inc …
Context & Ripple Effects
Five weeks after reports that Uber was in talks with banks for a $1 billion credit facility, the deal has doubled in size: more banks wanted in than there was room for at the original size, so the amount sought rose to $2 billion and the facility is being finalized. The move lands in the middle of a heavy capital run — weeks earlier, sources said Uber planned to raise $1.5–$2B more in equity at a valuation of $50B or higher.
The pattern matters because it shows lenders treating a money-losing private company as a marquee borrower: demand came from the banks' side, not from a bigger need Uber had advertised.
First-order effects
- Uber walks away with twice the committed liquidity it originally asked for — a $2B revolving backstop secured without giving up equity, on top of the equity round it was already lining up.
- The oversubscribed syndicate means participating banks accepted smaller individual commitments than they wanted, paying up in share-of-deal terms just to be on Uber's roster of lenders.
Second-order effects
- When banks compete this hard to lend to one private company, the leverage shifts toward the borrower on pricing and covenants — a dynamic that resurfaces in 2018 when Uber seeks a second leveraged loan and approaches loan investors directly rather than through banks (second leveraged loan).
- The facility lowers the pressure on Uber's next equity raise to fund operations, letting it hold out for a higher valuation — which is roughly what happened when sources reported a fall round near $60B–$70B.
Third-order effects
- If late-stage private companies can stack bank credit lines, leveraged loans, and mega venture rounds side by side, the traditional sequence — debt only after going public — breaks down, and underwriting standards migrate into the private market years before any IPO scrutiny.
The trend: Late-stage private tech companies are layering large debt facilities on top of ever-bigger equity raises as lenders chase them down the risk curve.