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SoftBank Looks to Raise More Than $23B Through IPO of Mobile Unit

By NexChange
Financial Services

SoftBank Group announced that it’s aiming to raise more than $20 billion through the initial public offering of its Japanese mobile unit, which has been approved by the Tokyo Stock Exchange for a listing on Dec. 19.

The IPO will offer up to about 37% of the mobile unit, known as SoftBank Corp., and will seek to raise $23 billion. With the company also awaiting regulatory approval for the pending sale of its stake of Sprint in the U.S. to T-Mobile, it sets up SoftBank and CEO Masayoshi Son to focus on growing its massive $100-billion Vision Fund portfolio of technology companies.

SoftBank could also be positioning itself to pay off its swelling debt, as the, the Wall Street Journal reports.

For years, the Japanese market has helped bankroll Mr. Son’s ambitions. The country’s banks, smarting from decades of low interest rates, have been eager to lend SoftBank billions of dollars, while individual investors have snapped up its bonds.

Now Mr. Son is betting that Japanese stock investors, facing a dearth of domestic tech IPOs, will welcome the chance to buy into one of Japan’s three main mobile carriers. About 90% of the shares will be offered domestically.

The IPO and a planned deal to sell control of Sprint to T-Mobile US Inc., which is awaiting regulators’ approval, are set to help SoftBank Group lower its ballooning debt. The group’s debt was close to ¥18 trillion as of Sept. 30, compared with ¥3.2 trillion in cash and cash equivalents.

Among the 22 startups the Vision Fund has invested in include Uber, Magic Leap and WeWork. As the Financial Times pointed out two years ago, the $100 billion fund is roughly the same size “as all funds raised by US venture capital firms over the last two and a half years.”

Photo: Getty iStock

 

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