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SoftBank Nets $11 Billion From Alibaba Stake Sale

By Bloomberg / Jun 05, 2019 03:59 AM / Business & Tech

Photo: VCG

Photo: VCG

Japanese conglomerate SoftBank Group Corp. will book a pretax profit of 1.2 trillion yen ($11.1 billion) from selling part of its stake in Chinese e-commerce leader Alibaba Group Holding Ltd., completing a deal announced three years ago.

The Japanese investment giant said Tuesday it had fulfilled a deal unveiled in 2016, delivering 73 million American Depositary Shares in the online mall operator as agreed to under a forward sale contract. SoftBank, Alibaba’s biggest shareholder, was selling shares in the Chinese company for the first time in 16 years as it looked to strengthen its balance sheet and step up investments in promising startups.

The Alibaba deal was one of several divestments spearheaded by former SoftBank President Nikesh Arora, a portfolio reshuffle that also included the sale of its stake in Clash of Clans developer Supercell Oy. That maneuver made it possible for founder Masayoshi Son to buy chip designer ARM Holdings Plc for $32 billion in 2016, and helped with the creation of the $100 billion Vision Fund.

SoftBank still holds about 26% of Alibaba after the deal. The Japanese company’s own shares have gained 27% this year.

Related: HKEx Chief Charles Li Tells Alibaba ‘Welcome Home’
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