TOKYO-Softbank Group Corp
Red-hot stock markets for large-scale quarterly profits, largely on the back of investment gains on its $ 100 billion vision fund and its $ 10 billion successor.
The Japanese technology investor said on Monday that it posted a net profit of illion 1.17 trillion, equivalent to about $ 11 billion, ending December 31 at an investment profit of 1. 1.77 trillion at the end of the quarter. About 80% of the investment gains were due to strong performance. On Vision Funds 1 and 2.
Anticipation of strong results raised SoftBank’s stock price by 4.4% to 9,485 Monday – last seen in February 2000, when the company’s shares were at a peak during the Internet bubble.
“We have finally entered the harvest phase” for Vision Fund, SoftBank chief executive Masayoshi Son said at a Tokyo news conference, standing in front of a slide showing a huge column of gold eggs that hit SoftBank’s investment Represents.
The results highlight how the uptick in public markets has benefited SoftBank over the past several months, which has transformed itself from a telecom conglomerate to an investment holding company over the past year. Rising stock prices last year helped Softbank return to the black with a multi-billion dollar loss.
Those gains continued in the latest quarter, boosting the market capitalization of listed companies of Vision Funds – the most important ride-hailing Uber Technologies Inc.
One of the largest investments of the fund.
Enthusiastic public market investors also gave Vision Fund portfolio company DoorDash an investment bonus to SoftBank Inc.
Listed in December. Shares of the American food-distribution company immediately rose well above its initial public offering price. By the end of the month, Dordash had earned more than $ 8 billion in paper profits to the fund, and its shares continue to grow.
SoftBank said the quarter ended December was the best of the Vision, resulting in a $ 13 billion gain in the value of its investment.
Softbank is set to take advantage of strong markets this year. Rajiv Mishra, CEO of Vision Fund, said on a November call by boutique research firm Street Research that half a dozen or more of the vision fund’s investments, some of which already have multibillion-dollar valuations, are due this year. Preparing initial public offerings. Mr. Son said that together their funds can produce 10 to 20 IPOs in a year.
SoftBank has rolled out or filed listing applications for at least four special-purpose acquisition companies, or SPAC, blank-check firms that first go public and then later find a company to handle the listing.
The performance in Softbank’s latest investment unit was not so good, an asset-management firm called SB Northstar is run by Mr. Son who invests in listed companies. The unit, in which Mr. Son owns one-third stake, made waves last year when it offered an alternative that the share prices of some large tech companies would go up.
Those bets sharply reduced losses, and the unit narrowed its options at the end of last year, people familiar with the matter said at the time. According to softbank data, between derivatives and stock investment, SB Northstar invested approximately ₹ 170 billion in the latest quarter.
Mr Son said he was still testing Northstar and was receiving the benefit by Monday.
write to Phred Dvorak at [email protected]
Copyright © 2020 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8