Google Parent Alphabet Mulling $1B Lyft Investment

Larry Page

Look out Uber. Sources claim Alphabet is now in talks about making a major investment in ridesharing company Lyft, something that will be done through either Google or CapitalG.

A potential $1 billion investment in Lyft Inc. would mark a new direction in Google's ride sharing strategy. In May, Alphabet's self-driving auto unit, Waymo, signed a deal with Lyft to collaborate on autonomous-vehicle technology. Either way, this can't be good news for Uber.

Google had previously invested more than $250 million in Uber. Vancouver could be a challenge, given the fact that it is situated in British Columbia, the province which does not allow any ride-sharing services to operate. It invested in Uber early in its life through investment arm GV, but these two are now locked in battle in a lawsuit over stolen trade secrets. Mehta declined to comment on Lyft.

Alphabet is now a shareholder at Uber as well through its venture capital company GV, but Waymo, an Alphabet unit is now suing Uber for technology for self-driving vehicles. Alphabet could put the investment under CapitalG, an investment arm, or Google itself. Axios reports that the investment is being pushed by top-level executives rather than Alphabet's in-house investment fund organizations. Lyft was in informal talks with Alphabet along with other possible suitors in 2016 but a sale was not pursued.

An investment would also strengthen Lyft's relationship with Alphabet, which has emerged as one of Uber's most powerful foes.

"The round is significant, not only because of the deal size, but because the shares will likely be purchased at Uber's last private valuation of almost $70 billion", TechCrunch reports. While still much smaller than Uber, Lyft has seen its market share grow recently, in part because of its rival's many scandals. In May, Lyft reached a deal to work on a self-driving-vehicle pilot program with Waymo, Alphabet's autonomous-vehicle subsidiary.

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