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A stock and a hard place: they turned out to $150 billion, Alibaba warchest in the process

TOKYO (Reuters) – SoftBank (9984.(T) CEO, Masayoshi Son, threw cold water Wednesday on the idea of the cut of his company’s $150-billion stake in the e-commerce giant Alibaba (BABA).N is for, after all, a prominent activist investor Elliott Management is the name of the great redemption.

FILE PHOTO: a japanese SoftBank Group, Corp Chief Executive Masayoshi Son attends a news conference in Tokyo, Japan, on November 5, 2018. REUTERS/Kim Kyung-Hoon/File Photo

The rise and rise of New York city, on the basis of the One as the one SoftBank is a shareholder and has a renewed focus on the company’s 26% stake in china’s Alibaba, the Japanese firm’s most important asset, and their Son was the most successful of the tech-bet-to-date.

As one of the world’s most well-known activist investor, has amassed a holding of about $3 billion in SoftBank. It is now pushing for amendments, including a $20 billion stock buyback, the sources said. However, the Son indicated that he was not in a hurry to sell down, with the Alibaba shares, questions will arise as to how SoftBank was able to fund, if any, for redemption.

“I believe that Alibaba has a lot of room to grow. No, I’m not in a hurry to sell shares,” he said at a press conference on Wednesday.

SoftBank has been greatly enlarged, and is struggling to attract outside money to build a second tech fund. Son’s reluctance to sell down its holding in Alibaba, leave a little room for redemption at the scale She wants to be, analysts said.

“From a shareholder’s perspective, you’ll be able to sell it and invest in a business which is profitability,” said Kirk Boodry, an analyst at Redex Holdings, which reports on the research platform Smartkarma.

As they turned to think that the outcome would not be better than Alibaba, “it’s strange to be in the venture capital business,” he said.

SoftBank has had little to dispel investor concerns about its strategy, and on Wednesday, reporting that quarterly profit was almost wiped out by the second consecutive quarter of losses with a $100 billion Vision for this Fund.

“These results validate our concerns, and that most of the other things that are (SoftBank), it is outside of Alibaba, have led to the derivation of, or value destruction,” Jefferies analyst Atul Goyal wrote in a note.

The stakes in the e-commerce giant was worth about $150 billion – more than the market capitalization of SoftBank, itself, which is no more than $110 billion.

The son of the group the group has a few of these assets could be used. Others have two-thirds of the property of the Japanese, the wireless device SoftBank Corp. (a) (9434.(T), although the SoftBank Group is dependent on dividends received from the mobile unit to the cash flow.

They have agreed to pay 85% of the net profit as a dividend.

SoftBank Group was 3.8 billion yen ($35 billion) in cash and cash equivalents on the books at the end of December.

However, the use of which is limited due to SoftBank’s own financial policy in an effort to reassure investors – including a pledge to retain enough money to cover the bond repayments for a period of at least two years.

They turned to the weighted average cost of debt is the highest of all of the companies on Japan’s Nikkei 225 Stock Average .N 255, in accordance with Refinitiv of the data.

A son sold part of its Alibaba stake ahead of the 2016 buyout of chip designer Arm, a secondary operation to put it on his head, and the subsequent rise in Alibaba’s share price, a move that was a surprise at the time, and it may well augur for further surprises.

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As a Son, said on Wednesday he was lined up with The side, he has made it very clear what changes would have to be on their own terms and conditions.

“I am, SoftBank’s largest shareholder, so I have to take care of the price of the stock, and also to increase the value of it,” he said.

“But it should be left up to us, the board of directors.”

Report by Sam Nussey; Editing by David Dolan and Susan Fenton

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