Uber is turning to the riskiest part of the debt market to raise up to another $2 billion

source
Wikimedia, CC

Uber is raising “up to $2 billion” in the form of a leveraged loan, according to a new report from The Wall Street Journal’s Marueen Farrell, Matt Wirz, and Douglas MacMillan.

The ride-hailing company is tapping Barclay’s PLC and Morgan Stanley to sell the leveraged loan, according to the Journal.

The move comes just two weeks after the ride-hailing service raised $3.5 billion from a Saudi Arabian investment fund.

In the coming weeks, Uber is also said to be planning to tap institutional investors for a loan as well.

Most new leveraged loans have an average yield between 3.9% and 5.5%, but Uber is hoping its loan will be priced with a yield between 4% and 4.5%, a low rate for a first-time issuer, the Journal reported.

The leveraged loan market is often used by private companies – those with “junk” ratings or lower – or the riskiest corporate borrowers. This new loan would bring Uber’s total debt and equity up to about $15 billion, according to the Wall Street Journal.

The ride-hailing company is currently valued at $62.5 billion.