Uber’s purchase of self-driving truck company Otto came at a price that was much lower than originally thought, according to a new analysis from Mark Harris at IEEE Spectrum.

It was widely reported in August 2016, that Uber paid the equivalent of 1 percent of its stock, or $680 million, to acquire Otto. But new information surfaced in the legal drama between Uber and Waymo, Alphabet’s self-driving car unit, indicating that Uber may have paid as little as $220 million, based on IEEE’s calculation.

Legal documents show that Uber paid 12 million shares for Otto, along with some cash bonuses for employees. However, close to half of those shares went to Otto’s ex-CEO Anthony Levandowski, who was fired by Uber in May after being accused of stealing trade secrets from Google, his former employer, and not cooperating with the investigation.

Uber confirmed to CNBC that Levandowski received nothing in vested shares before he was fired. Therefore, Uber paid far less for Otto than expected.

Still, even if the dollar amount is reduced, Otto has cost Uber dearly in reputational damage, legal costs and time.

You can read Harris’s explanation here. In short, a new filing from earlier this week suggests that Uber paid with approximately 12 million shares “contingent on milestones,” in addition to cash signing bonuses. That would equal $556 million at Uber’s 2016 valuation, lower than the originally reported $680 million. Uber revealed in court that it granted Levandowski 5.31 million Uber shares, which was nearly 45 percent of the Uber purchase. Because Levandowski only took his signing bonus with him, Uber paid at most 6.69 million Uber shares.

Harris calculates that those numbers, coupled with a drop in Uber’s valuation and other Otto employees leaving the company, could bring the number as low as $220 million.

Source: Tech CNBC
Uber's purchase of Otto looks like it was much cheaper than originally reported