Uber’s warring board members have struck a peace deal that allows a multibillion-dollar investment by SoftBank to proceed, and which would resolve a legal battle between former chief executive Travis Kalanick and a prominent shareholder.

Venture capital firm Benchmark, an early investor with a board seat in the ride-services company, and Mr Kalanick have reached an agreement over terms of the SoftBank investment, which could be worth up to $10bn (£7.7bn), according to two people familiar with the matter.

The Uber board first agreed more than a month ago to bring in SoftBank as an investor and board member, but negotiations have been slowed by ongoing fighting between Benchmark and Mr Kalanick. The agreement struck on Sunday removed the final obstacle to allowing SoftBank to proceed with an offer to buy to stock.

​Uber confirmed the deal was moving forward.

“We’ve entered into an agreement with a consortium led by SoftBank and Dragoneer on a potential investment,” an Uber spokesman said. “We believe this agreement is a strong vote of confidence in Uber’s long-term potential.”

SoftBank, a Japanese conglomerate that has become a heavyweight in Silicon Valley tech investing, is joined by Dragoneer Investment Group in leading a consortium of investors that plans to invest $1bn to $1.25bn in Uber, and in addition, will buy up to 17 per cent of existing shares from investors and employees in a secondary transaction. The terms were signed on Sunday, although the tender offer would likely take weeks to complete.

Uber is valued at $68bn, the most highly valued venture-backed company in the world. SoftBank’s roughly $1bn investment of fresh funding is expected to be at the same valuation. The secondary transaction, or the purchases from employees and existing investors, would be at a lower valuation.

A spokesperson for Benchmark did not immediately respond to a request for comment, and a spokesman for Kalanick declined to comment.

Completing the SoftBank deal would allow Uber to open a new chapter after a year of controversy, including the resignation of Kalanick, the ouster of several top executives, sexual harassment and discrimination allegations, and multiple federal criminal probes. The deal is also tied to new governance rules that aim to distribute power more equally and bring more oversight to the company.

“Uber had a remarkable first six or seven years, a bumpy past two years, and now the SoftBank deal allows for a full reset,” said Bradley Tusk, an Uber investor and political strategist who works with tech companies.

It would also be a major victory for Uber’s new chief executive, Dara Khosrowshahi, who often served as a mediator to help broker the agreement, according to a third person familiar with the matter.

To allow the deal to go forward, Benchmark has agreed to immediately suspend its lawsuit against Mr Kalanick, which it filed in August in an effort to diminish the ex-CEO’s power at the company and force him off the board, one of the sources said.

On the successful completion of the SoftBank investment, Benchmark would drop the lawsuit entirely, the person said.

In turn, Kalanick must receive majority board approval should he want to replace the board seats over which he has control, according to the source. In addition to his own seat, Mr Kalanick controls two more, which are occupied by Ursula Brown, the former Xerox Corp chief executive, and former Merrill Lynch chief executive John Thain. Mr Kalanick appointed them in September without first consulting with the board.

“Ending the litigation is a big step forward if it finally ends the specter of Kalanick retaking control,” said Erik Gordon, an entrepreneurship expert at the University of Michigan’s Ross School of Business.

Uber’s board already approved a slate of governance reforms that are contingent on completion of the SoftBank deal. They include removing super-voting rights that gave Mr Kalanick and his allies outsized power, adding new independent directors and increasing the size of the board to 17.

Business news: In pictures Show all 13 1 /13 Business news: In pictures Business news: In pictures Flybe collapses Airline Flybe has collapsed. All future flights on the Exeter-based airline have been cancelled – leaving more than 2,300 staff facing an uncertain future, and wrecking the travel plans of hundreds of thousands of passengers. The chief executive, Mark Anderson, said: “Europe’s largest independent regional airline has been unable to overcome significant funding challenges to its business. AFP via Getty Business news: In pictures Future product placement will be 'tailored to individual viewers' Marketing executives say that product placement in films and televison shows on streaming services such as Netflix may be tailored to individuals in future. For instance, if data shows that a viewer is a fan of pepsi, a billboard in the background of a shot would host an advert for pepsi, while for a viewer known to have different tastes it could be for Coca-Cola Paramount Business news: In pictures Corbyn wishes Amazon a happy birthday In a card sent to Amazon CEO Jeff Bezos on the company's 25th birthday, Labour leader Jeremy Corbyn writes: "You owe the British people millions in taxes that pay for the public services that we all rely on. Please pay your fair share" Business news: In pictures No deal, no tariffs The government has announced that it would slash almost all tariffs in the event of a no-deal Brexit. Notable exceptions include cars and meat, which will see tariffs in place to protect British farmers Getty Business news: In pictures Fingerprint payment NatWest is trialling a new bank card that will allow people to touch their hand to the card when paying rather than typing in a PIN number. The card will work by recognising the user's fingerprint NatWest/PA Wire Business news: In pictures Mahabis bust High-end slipper retailer Mahabis has gone into administration. 2 Jan 2019 Mahabis Business news: In pictures Costa Cola Coca-Cola has paid £3.9bn for Costa Coffee. A cafe chain is a new venture for the global soft drinks giant PA Business news: In pictures RIP Payday Loans A funeral procession for payday loans was held in London on September 2. The future of pay day lenders is in doubt after Wonga, Britain's biggest, went into administration on August 30 PA Business news: In pictures Musk irks investors and directors Elon Musk has concluded that Tesla will remain public. Investors and company directors were angry at Musk for tweeting unexpectedly that he was considering taking Tesla private and share prices had taken a tumble in the following weeks Getty Business news: In pictures Jaguar warning Iconic British car maker Jaguar Land Rover warned on July 5, 2018 that a "bad" Brexit deal could jeopardise planned investment of more than $100 billion, upping corporate pressure as the government heads into crucial talks AFP/Getty Business news: In pictures Spotif-IPO Spotify traded publically for the first time on the New York Stock Exchange on Tuesday. However, the company isn't issuing shares, but rather, shares held by Spotify's private investors will be sold AFP/Getty Business news: In pictures French blue passports The deadline to award a contract to make blue British passports after Brexit has been extended by two weeks following a request by bidder De La Rue. The move comes after anger at the announcement British passports would be produced by Franco-Dutch firm Gemalto when De La Rue’s contract ends in July. The British firm said Gemalto was chosen only because it undercut the competition, but the UK company also admitted that it was not the cheapest choice in the tendering process. Business news: In pictures Beast from the east economic impact The Beast from the East wiped £4m off of Flybe’s revenues due to flight cancellations, airport closures and delays, according to the budget airline’s estimates. Flybe said it cancelled 994 flights in the three months to 31 March, compared to 372 in the same period last year.

Uber plans to run newspaper ads informing investors about the share purchase, and SoftBank will propose a price at which it will buy stock. The company has threatened to invest in ride-hailing rival Lyft if it does not get the Uber deal done.

The deal gives early investors such as Benchmark, whose Uber stake is worth nearly $9bn, the opportunity to cash out a very lucrative investment.