SoftBank has reportedly liquidated $7.2B worth of Alibaba shares through prepaid forward contracts this year.
The move will dilute SoftBank's ownership percentage stake in Alibaba
from 13.7% at the end of December 2022 to 3.8%. The Japanese VC firm is
prioritizing financial discipline to recoup losses and recover from
failed VC bets.
- SoftBank initially invested $20M into Alibaba nearly 20 years ago.
- At its peak, SoftBank held a nearly 34% stake in the Chinese group, then led by founder Jack Ma.
- In
late December 2022, SoftBank liquidated 30 million shares worth $2.7B,
followed by the forward sale of 46 million shares in February 2023 for
$4.5B.
- SoftBank used the proceeds to balance its Vision Fund II losses, pay off debt, and repurchase shares.
- At the end of December 2022, SoftBank had $43B cash on its balance sheet.
- Yesterday, it was discovered that SoftBank would sell its early-stage investment division to a new firm established by Taizo Son, Masayoshi Son's younger brother.
