SoftBank's upcoming “marriage” with the Saudi Prince, Mohammed bin Salman al-Saud, will give rise to the biggest fund ever raised. With a total sum of $100 billion the Japanese group will beat the previous record of $21.7 billion set by The Blackstone Group in 2006.
Masayoshi Son, chief executive of SoftBank, famous for his bold and wide-ranging bets, was able to stipulate a partnership with The Public Investment Fund (PIF), Saudi Arabia's top sovereign wealth fund. The PIF, established in 1971, was born to provide financing support for strategic investments for the national economy. In this particular alliance it will contribute with an amount of $45 billion. SoftBank's stake in the deal will be of $25 billion and lastly other investors will provide $30 billion.
The scope of the fund will be technology, that is also the main reason that made this deal so appealing for the Saudi Prince. Indeed Mohammed bin Salman al-Saud's aim is to find a new way to overhaul Saudi Arabia’s economy and reduce its reliance on oil. This is due to the plunge in crude prices since 2014 has created some issues to the kingdom finances. As a consequence the PIF has widened its scope and size making technology one of its brand-new targets.
"With the establishment of the SoftBank Vision Fund, we will be able to step up investments in technology companies globally. Over the next decade, the SoftBank Vision Fund will be the biggest investor in the technology sector," SoftBank Chairman Masayoshi Son said. About the strategy adopted by the fund no clear information has been released yet. However Mayasoshi Son has proved many times of having a particular intuition for tech-bets. For example SoftBank has been one of the first investors in Yahoo Corp. and its investment in Alibaba revealed to be Mr. Son's best success. Other recent investments include participation in a $4.5 billion fundraising round for Chinese Didi Chuxing Technology Co. and $1 billion into South Korea's largest commerce company Coupang. For what concerns the future we can surely expect SoftBank's gambit to have an extraordinary echo in the years to come.
Mattia Degiovanni
Masayoshi Son, chief executive of SoftBank, famous for his bold and wide-ranging bets, was able to stipulate a partnership with The Public Investment Fund (PIF), Saudi Arabia's top sovereign wealth fund. The PIF, established in 1971, was born to provide financing support for strategic investments for the national economy. In this particular alliance it will contribute with an amount of $45 billion. SoftBank's stake in the deal will be of $25 billion and lastly other investors will provide $30 billion.
The scope of the fund will be technology, that is also the main reason that made this deal so appealing for the Saudi Prince. Indeed Mohammed bin Salman al-Saud's aim is to find a new way to overhaul Saudi Arabia’s economy and reduce its reliance on oil. This is due to the plunge in crude prices since 2014 has created some issues to the kingdom finances. As a consequence the PIF has widened its scope and size making technology one of its brand-new targets.
"With the establishment of the SoftBank Vision Fund, we will be able to step up investments in technology companies globally. Over the next decade, the SoftBank Vision Fund will be the biggest investor in the technology sector," SoftBank Chairman Masayoshi Son said. About the strategy adopted by the fund no clear information has been released yet. However Mayasoshi Son has proved many times of having a particular intuition for tech-bets. For example SoftBank has been one of the first investors in Yahoo Corp. and its investment in Alibaba revealed to be Mr. Son's best success. Other recent investments include participation in a $4.5 billion fundraising round for Chinese Didi Chuxing Technology Co. and $1 billion into South Korea's largest commerce company Coupang. For what concerns the future we can surely expect SoftBank's gambit to have an extraordinary echo in the years to come.
Mattia Degiovanni