FILE PHOTO: People walk behind the logo of SoftBank Corp in Tokyo December 18, 2014. (REUTERS photo/Toru Hanai/File Photo
TOKYO (Reuters) – SoftBank Group Corp, said on Friday to buy back up to 7% of the shares in the company for as much as 500 billion yen ($4.8 billion) – in a decision that comes after activist investor Elliott Management pushed for $20 billion in stock repurchases.
A SoftBank spokeswoman said that the company had decided to conduct the buy-back of own initiative, after consideration of the risks of the current volatility of the stock market, it would be able to raise the deep discount, which they turned into a stock relative to the value of the investments.
No new funding is planned for the acquisition, the spokesperson said.
The company said last month that it plans to lend up to 500 billion yen by 16 domestic and foreign financial institutions, with the help of a part of its stake in the telecom company, SoftBank Corp., as collateral to boost the cash on hand.
As one of the world’s most powerful activist investor, has amassed a holding of about $3 billion in SoftBank, and has put pressure on SoftBank to a range of issues, including the buy-back and to improve the level of transparency.
SoftBank’s shares fell by nearly 8% in afternoon trading, the Tokyo market dropped on concerns over the economic impact of the corona virus outbreak.
Reporting by Tim Kelly and Makiko Yamazaki; Editing by Shri Navaratnam and Edwina Gibbs