SoftBank has reported a record loss of JPY 1.9 trillion (USD 18 billion) at its giant Vision Fund, resulting in SoftBank’s worst annual loss of JPY 1.4 trillion (USD 13 billion).
According to Softbank, Uber’s stock price drop accounted for around USD 5.2 billion (30%) of Vision Fund’s losses. WeWork’s losses totalled USD 4.6 billion (26.5%), with the remaining USD 7.5 billion (43.4%) coming from the rest of the portfolio.
Last month, the company announced that it was expecting a record JPY 1.35 trillion (USD 12.5 billion) loss for the fiscal year that ended on 31 March 2020. The announcement also forecasted a JPY 1.8 trillion (USD 16.5 billion) loss from its investment vehicle Vision Fund, as well as another JPY 800 billion (USD 7.4 billion) in losses from other investments.
SoftBank also revealed a share buyback plan of up to JPY 2 trillion (USD 18 billion) on top of a JPY 500 billion (USD 4.5 billion) repurchase program announced earlier this month, which will be funded by the JPY 4.5 trillion (USD 41 billion) asset sale program that was proposed in March.
“This program will be the largest share buyback and will result in the largest increase in cash balance in the history of SBG, reflecting the firm and unwavering confidence we have in our business,” said Masayoshi Son, Chairman and CEO of Softbank. “This will allow us to strengthen our balance sheet while significantly reducing debt. Moreover, the monetisation of assets represents less than 20 per cent of the Company’s current asset value.”
The company also announced that Alibaba co-founder Jack Ma would step down as a board director on 25 June after 13 years of service. Softbank will move forward with its remaining 10 board members, with plans to nominate 3 new directors.
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