Uber, Slack Say Board Members Made Unauthorized Comments on TV
(Bloomberg) -- Uber Technologies Inc. and Slack Technologies Inc. said board members made unauthorized statements about the companies ahead of their public stock offerings during interviews on CNBC.
Slack said it was unaware of a televised interview last month with a director, Chamath Palihapitiya, who commented on the company’s registration with the Securities and Exchange Commission and an expected listing on the New York Stock Exchange. Palihapitiya, who owns 10% of Slack, was asked by CNBC host Scott Wapner when a listing could be expected. “It will be soon,” Palihapitiya said, according to a transcript of the April 30 interview included in a regulatory filing.
Uber submitted a separate filing with the SEC on Tuesday about a CNBC interview last week with a board member, Yasir Al-Rumayyan of Saudi Arabia’s Public Investment Fund. Uber said it hadn’t sanctioned his comments about the business or valuations. In the interview, the Uber director drew contrasts to Lyft Inc., the biggest ride-hailing alternative in the U.S. whose stock has fallen well below the IPO price.
Stock listings of technology startups are surging this year. The disclosures this week show the challenges companies are facing as they adjust to the rules of the public markets and check their investors’ enthusiasm. The SEC limits what companies that are planning public offerings can say about their prospects before selling shares.
The Slack and Uber directors aren’t the first to have been called out for violating the SEC’s “quiet period” restrictions ahead of a market listing. In 2004, Google co-founders Sergey Brin and Larry Page gave an interview to Playboy magazine that drew scrutiny from the SEC and threatened to derail the IPO over comments about the timing of the listing. And Groupon Inc. twice almost saw its listing pulled over executive comments. Once when an internal email to employees was leaked to a tech website, All Things D, and again when Chairman Eric Lefkofsky said the company would be “wildly profitable.”
The SEC published Uber’s plans for an initial public offering in April. The stock is expected to begin trading on Friday, in the biggest U.S. IPO in years. Slack, which makes workplace-messaging software, also filed its plans to U.S. regulators in April. It will go public through an unusual direct listing process. When asked about that decision, Palihapitiya said, “I love it” and called Chief Executive Officer Stewart Butterfield “incredible.”
Palihapitiya also compared Slack with Facebook Inc., where he was an early senior executive. “The only company in the world that looks like that today that is not yet public is called Slack,” he said. “From that perspective I think it is the most incredible business that we have seen probably the next closest thing to it is a company that just went public recently, which is Zoom.”
In the filing, Slack said it was not involved “in any way” in the interview or the preparation of statements Palihapitiya made in the interview. “The statements made by Mr. Palihapitiya and the other persons in the interview do not reflect the company’s views and are not endorsed or adopted by the company,” Slack said.
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