Japan’s SoftBank restarts buybacks as asset sales swell cash pile

FILE PHOTO: Japan's SoftBank Group Corp Chief Executive Masayoshi Son bows his head after his presentation at a news conference in Tokyo, Japan, Nov. 5, 2018. REUTERS/Kim Kyung-Hoon/File Photo

SoftBank Group Corp resumed its share buybacks in September, after an enforced pause in August due to asset sales, saying on Wednesday it spent 40 billion yen ($380 million) of its growing cash pile.

This is in line with previous signalling of a slower pace of purchases from SoftBank, which spent 1 trillion yen on buybacks between March and early August after the gap between the value of its assets and market valuation reached record levels.

SoftBank‘s shares traded sideways during the lull in August ahead of deal news, which included the sale of chip designer Arm to Nvidia Corp, but have since resumed their climb and closed near two decade highs on Wednesday.

In a sign of SoftBank‘s restored confidence, its Vision Fund plans to market a blank-check company to investors, a source told Reuters, as it joins a trend to offer private companies a quick route to public markets.

The size of the company has not been decided, the source said, but could include SoftBank cash. In July 2019 SoftBank said it had secured $108 billion in pledges for a successor to its $100 billion Vision Fund, before a string of soured bets undermined fundraising efforts.

A recovery at the first fund, which analysts say could trigger a broader reappraisal of the group’s investing abilities, has yet to be seen, with its assets still underwater at the end of June.

Mitsunobu Tsuruo, a Citigroup analyst, forecasts SoftBank‘s earnings “at roughly breakeven” for the year ended March, while cautioning that it is “exceptionally hard for people outside the firm to establish a rational outlook for earnings”.

Citigroup estimates SoftBank‘s asset sales have topped 9 trillion yen ($85 billion) in the last six months.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.