Uber is moving along with its plan to expand its business in the Middle East thanks to a $3.5 billion investment from Saudi Arabia's Public Investment Fund.
The investment is one of the largest to ever be made into a privately held startup, and the Middle East has been an important area for Uber in its expansion. Saudi Arabia is one of the world's largest producers of crude oil, and Uber said the investment also expands on its relationship with the kingdom, which is trying to reduce its dependence on oil and improve employment in order to change its economy.
Saudi Arabia's decision comes as the oil industry is responsible for 80 percent of the government's revenue, though this wealth is not distributed evenly.
The agreement between Uber and Saudi Arabia came about in March when Uber board member David Plouffe traveled to the Middle East to attend a briefing with the Saudi fund.
While Saudi Arabia hasn't been involved much in venture capital investing, Prince Alwaleed bin Talal is among the members of the royal family to have made such deals, more specifically with Lyft, one of Uber's main rivals in the ride-sharing industry.
"We appreciate the vote of confidence in our business as we continue to expand our global presence," Uber co-founder and chief executive Travis Kalanick said in a statement. "Our experience in Saudi Arabia is a great example of how Uber can benefit riders, drivers and cities and we look forward to partnering to support their economic and social reforms."
The deal may also benefit women in Saudi Arabia, as Uber noted that 80 percent of its users in the country are women. While religious rules issued by conservative Muslim clerics forbid women in Saudi Arabia from driving, there is no formal law that keeps women in the area from doing so.
Though Uber didn't say if it planned to hire female drivers in Saudi Arabia, spokeswoman Jill Hazelbaker said that the company believes that women in the region should be allowed to drive. "In the absence of that, we have been able to provide extraordinary mobility that didn't exist before - and we're incredibly proud of that," she said.
The investment values Uber at $62.5 billion, and the company plans on investing $250 million in the Middle East.
Ride-sharing services such as Uber have been expanding to different parts of the world, and while some cities have been banning them due to fears of the licensing of drivers and other issues, the European Commission warned Thursday that restrictions by the European Union on these services should only be made in the interest of the public.
"Absolute bans and quantitative restrictions should only be used as a measure of last resort," it said.
