May 9, 2018 / 11:20 AM / 19 days ago

SoftBank to transfer ride-sharing stakes to Vision Fund

TOKYO (Reuters) - Japan’s SoftBank Group Corp said on Wednesday it plans to transfer its stakes in ride-sharing firms to the SoftBank Vision Fund, a move which if approved would make the fund one of the world’s biggest investors in the fast-changing industry.

FILE PHOTO: Shop employees of SoftBank Corp work outside its branch in Tokyo, Japan, August 6, 2015. REUTERS/Yuya Shino/File Photo

SoftBank plans to transfer, subject to approval, its combined $12.9 billion stake in Uber Technologies Inc and Didi Chuxing. It also aims to transfer its stakes in Grab and Ola, SoftBank Chief Executive Masayoshi Son told a news conference.

The move would provide the fund’s investors - which include Apple Inc, Hon Hai Precision Industry Co Ltd (Foxconn) and the sovereign wealth funds of Saudi Arabia and Abu Dhabi - significant exposure to the ride-sharing industry, which is being shaken up by consolidation in which SoftBank is playing a role.

In March, Uber said it would sell its Southeast Asian business to bigger regional rival Grab, with the U.S. ride-sharing firm focusing on a battle with Ola in India.

Son’s reputation as a visionary investor has attracted enough money to create the world’s largest private equity fund which, as of last May, stood at over $93 billion.

When combined with SoftBank’s smaller Delta Fund, SoftBank’s private equity arm had at the end of March invested $29.7 billion in 25 technology firms, with investments this year including dog-walking app Wag and construction startup Katerra.

Steered by founder and CEO Son, SoftBank has become a major global technology investor as it looks to create a group of leading tech companies powered by interconnected devices and artificial intelligence.

The company’s growing technology investments saw it post record operating profit for the year ended March, rising 27 percent to 1.3 trillion yen ($11.86 billion).

Son recently decided to let go of one of SoftBank’s biggest overseas bets, U.S. wireless carrier Sprint Corp, which will merge with T-Mobile US Inc after struggling to compete with bigger rivals.

Faced with investor confusion over how mutually supportive SoftBank’s array of investments are, Sprint’s outgoing CEO Marcelo Claure will become SoftBank’s chief operating officer, pledging to enhance cooperation between the portfolio companies.

Also at the news conference on Wednesday, Son let slip that U.S. retail giant Walmart Inc would acquire Indian e-commerce player Flipkart, ahead of an expected announcement by Walmart-Flipkart later on Wednesday.

Vision Fund invested in Flipkart last year, with its $2.5 billion stake now worth $4 billion, Son said.

SoftBank will consider relisting British chip designer ARM Holdings in five to seven years, Son also said. The $32 billion 2016 acquisition was Japan’s largest-ever outbound deal, though it looks set to be dwarfed by Takeda Pharmaceutical Co Ltd’s $62 billion purchase of Britain’s Shire PLC.

SoftBank shares closed up about 1 percent in a wider market that was down half a percent. However, SoftBank shares are down 4 percent so far this year.

($1 = 109.6200 yen)

Reporting by Sam Nussey and Thomas Wilson; Editing by Himani Sarkar and Christopher Cushing

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