SoftBank Group stock shot up 20% Tuesday, extending a rally that began a day earlier when the Japanese tech investor introduced as much as $41 billion in asset sales and a record share buyback to shore up its plunging share price.
SoftBank stocks settled Monday up 19%, reaching their daily cap after the conglomerate stated in the early afternoon it might repurchase as much as 2 trillion yen ($18 billion) worth of stocks along with an up to 500 billion yen purchase declared earlier this month.
CEO Masayoshi Son’s foray into investing in late-stage startups via SoftBank’s $100 billion Vision Fund has beaten the agency’s shares as major bets soured, forcing a promote-down of core components of its portfolio and buybacks – moves long sought by investors driving for enhanced shareholder returns.
Promoting down SoftBank’s stake in domestic wireless service SoftBank to 50% may increase round $10 billion whereas retaining control of the company, Goyal wrote.
A partial sale of SoftBank’s stake is likely, an individual familiar with the matter said, with shares more likely to be sold into the open market rather than back to the company.
Alibaba repurchasing shares from SoftBank will not please its shareholders, “you’re only making Masa Son happy. SoftBank wants to sell urgently but Alibaba will not be in such a hurry,” the source stated, who was not authorized to talk to media on the matter and so declined to be named.