SoftBank sells 45 million shares in Uber after China’s Didi bet backfires

About SoftBank and Uber

SoftBank Group Corp., based in Minato, Tokyo, is a Japanese global holding corporation. The majority of the Group’s investments are in firms that have a focus on the technology, energy, and finance areas. Masayoshi Son, the company’s founder and major stakeholder, is renowned for his entrepreneurship.

SoftBank Investment Advisers, which manages SoftBank’s Vision Fund, invests in developing technologies such as artificial intelligence and robots. It is aiming to increase its AI portfolio from 70 to 125 businesses, and moreover, it also invests in businesses that are changing the real estate, infrastructure, and retail industries.

Uber Technologies is the world’s largest ridesharing service. It was launched in 2009 and soon rose to become the most profitable startup in the world. The firm is headquartered in San Francisco and runs in over 900 cities across the world.

A necessary transaction

SoftBank sells 45 million

 

According to two individuals familiar with the situation, SoftBank is selling a substantial portion of its interest in Uber as the world’s most aggressive technology investor struggles with huge losses from a massive bet on China’s Didi Chuxing. SoftBank’s interest in Uber began in 2017, when it decided to pay $7.7 billion for 15% of the company’s stock, even though the holding was eventually transferred to the Vision Fund.

According to one of the sources, the Japanese corporation behind the $100 billion Vision Fund plans to sell approximately 45 million of its 184 million shares in Uber. In January, it sold 38 million Uber shares for approximately $2 billion. More shares were transferred in June, according to the second individual, and the current deal would bring SoftBank’s holdings below 100 million shares.

Redex Research Advisory claimed that the value of the two Vision Funds’ stated assets has dropped $11 billion since the beginning of the quarter in July, compared to a growth of $1.1 billion in the April-to-June quarter.

SoftBank sells 45 million

When Chinese authorities revealed a data security examination into Didi following its New York ranking earlier this month, the company’s market value plummeted to 50% of its pre-IPO maximum. With a 20.1 percent investment in Didi, the Vision Fund is the largest stakeholder, while Uber holds a 12 percent stake in the Chinese company (acquired 5 years ago).

In 2018, SoftBank bought shares in Uber. SoftBank Vision Fund grew their investment in Uber to $333 million in 2019. Uber refers to SoftBank as a major investor as recently as March 31.

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