TOKYO (Reuters) – SoftBank Group Corp. (a) have been reported in the vicinity of a total wipe-out quarterly earnings on Tuesday, after the Japanese technology investor, in a split of a second, consecutive quarter, due to losses incurred on a $100 billion Vision for this Fund.
FILE PHOTO: The logo of SoftBank Group, Corp, is displayed at SoftBank World in 2017 conference to be held in Tokyo, Japan, on July 20, 2017. (REUTERS photo/Issei Kato/File Photo
The sad outcome is likely to deepen concerns over its founder Masayoshi Son’s ability to get funding for a second, the Vision Fund, and give more ammunition to activist investor Elliott Management, which has recently emerged as a prominent shareholder.
The numbers are the latest reminder of the risks inherent in the Son, in the strategy of betting on a large, untested start-ups. The aim of the Fund is recorded as a net operating loss of 225-billion-yen ($2.05 billion) in October-December, compared with 176 billion-yen profit in the same period of the previous year.
But the Son, who was known for his ebullience and charisma, is still a rarity in corporate Japan, said that his company was already turning the corner.
He pointed to a rally in the prices of the Vision of the Fund as a handful of publicly-traded securities and with the news overnight that a US federal judge dismissed an antitrust challenge to the merger of SoftBank with Sprint Corp. and T-Mobile usa, Inc.
“The tide is turning,” he told a briefing after the release, they turned a profit.
The profit of the group amounts to 2.6 billion yen for the quarter, compared to 438 billion yen the previous year. The figure is listed at 332 billion yen in dilution gain in connection with the secondary listing of the portfolio company, Alibaba Group Holding Ltd.
The result is compared with that of the 345 billion-yen average of three analyst estimates compiled by Refinitiv. Analysts have said that it’s hard to judge they turned to run, due to a lack of disclosure around the Vision Fund is an internal values.
The Vision of the Fund, which is funded by the kingdom of Saudi Arabia, and has single-handedly changed the face of the technology to invest in, it said that it had invested $74.6 billion, with 88 companies as of December-end, at which time such investments were made, valued at $79.8 billion.
Son’s investment credentials took a hit in August / September quarter, which is the aim of the Fund took an $8.9 billion profit from operations the following weakness among the big bets, such as office-sharing firm WeWork.
Since then there has been a lot of companies in the portfolio, a hotel-booking platform, Oyo, cloud robotics, a company CloudMinds the right jobs and are under pressure to show that the long-term viability of their business models.
The fund itself has a loss of key employees.
On Tuesday, offered a bright spot in a united states federal judge dismissed an antitrust challenge to the proposed takeover by SoftBank troubled US wireless subsidiary Sprint Corp T-Mobile US, Inc., for the transmission of SoftBank stock, the highest price in seven months time.
However, they turned, faces pressure to improve shareholder returns after sources told Reuters last week that U.S. hedge fund Elliott Management, had an interest of almost $3 billion in the consortium, and to push for change, including a $20 billion stock buy-back.
Report by Sam Nussey; Editing by Christopher Cushing and David Dolan