Asian Buffett plans to sell more than 80 billion yuan of Ali shares for self rescue

category:Finance
 Asian Buffett plans to sell more than 80 billion yuan of Ali shares for self rescue


Softbanks first big loss

The current world situation is grim, with bad news every day, and I personally reflect on it every day. In this way, sun Zhengyi will start the performance statement of fy2020 (April 2019 to March 2020).

The financial year 2020 performance report as of March this year shows that Softbank group has a loss on its operations one point three six JPY trillion, net loss of JPY 961.6 billion, the largest loss since its establishment, net profit in the last fiscal year one point four one one one Trillion yen.

According to the statement issued by Softbank, the main reason for the huge loss in the previous fiscal year is that its vision fund will appear One point eight A trillion yen loss. Softbank also said that the companys performance was seriously affected by the new crown epidemic. In the fourth fiscal quarter (January March 2020), vision fund recorded investment losses One point one Trillion days. If the outbreak continues, there will continue to be uncertainty in the groups investment business in the new financial year.

Softbank vision fund was established in 2017. The first phase of the fund has a large scale of US $100 billion, mainly investing in arm, Uber, Didi travel, Wework and other companies. In August 2019, Softbank announced the establishment of vision fund phase II, with the same scale of $108 billion, focusing on investment in artificial intelligence.

Specifically, Ubers share price changes recorded investment losses fifty-one point seven nine US $100 million, Wework and its three associates recorded losses on investment forty-five point eight two Billion dollars. Other investment companies recorded losses seventy-five point zero two Billion dollars.

Such a huge investment loss has wiped out the telecom operation and other business sectors of Softbank, as well as the profits of continuous income from the investment in Alibaba. According to the financial report, there are 88 companies in the vision portfolio, with a cumulative investment of about $75 billion and a fair value of $69.6 billion (excluding exit investment).

Sun Zhengyi said that in the past year, 26 of the 88 invested enterprises have increased their valuations, while 47 have declined. Sun Zhengyi described it as unicorn fell into the pit of new crown. Ubers current share price is about 70% of its IPO price. Softbank invested $1.5 billion in Indian Unicorn Oyo hotel. Last month, Softbank implemented salary reduction measures and temporary leave to deal with the impact of the epidemic. In addition, oneweb, a satellite operator invested by Softbank itself, filed for bankruptcy in March.

Photo source: screenshot of Softbank press conference

At the press conference, sun Zhengyi expressed dissatisfaction when asked by reporters whether he regarded the vision as failure. He pointed out that from December last year to March this year, both the New York Stock Exchange and the Tokyo Stock Exchange saw a sharp drop in stock prices. Some famous investors even lost nearly 30% of their stock prices, and some enterprises lost more than 15%. In such a bad market environment, the scale of vision is more than 8 trillion yen. Now, the loss in my opinion, its not bad. We will continue to invest, but its not exciting Investment in the future will take a cautious step. .

Ma Yun resigns the board of directors of Softbank

After a huge loss, Softbank launched an active self rescue operation.

In March, Softbanks share price fell sharply, in order to hold the decline, Softbank announced the first repurchase plan on March 13, with a scale of 500 billion yen, but failed to stop the decline. On March 23, Softbank disclosed the supplementary announcement of share buyback, and the planned sale scale reached Four point five Of the trillion yen ($41 billion) of assets raised, 2 trillion yen ($18 billion) will be used to buy back shares, and the rest will be used to repay debts, buy corporate bonds and increase deposits, which are expected to be completed in the next four quarters.

Judging from Softbanks recent performance, the funds raised for buyback are obtained by selling its shares in Alibaba and other telecom companies.

According to foreign media reports, Softbank group is close to reaching an agreement to sell about $20 billion of its shares in t-mobileus Inc., stepping up its financing activities after a record loss in its investment business. People familiar with the matter said talks were still under way and the deal could still change or break down. The market value of t-mobileus is about US $126 billion, and that of Softbank is about US $31 billion.

In the financial statements of 2020, sun Zhengyi made it clear that he planned to use Alibabas equity financing one point two five Trillion yen (about $11.5 billion).

According to e company of securities times, in April and may this year, the subsidiaries of Softbank reached a forward contract with the bank to sell Alibabas equity. In order to avoid the impact of exchange rate fluctuations and stock price fluctuations, they plan to sell Alibabas equity through forward contracts, interest rate guaranteed options and collar options. Among them, the forward contract financing is US $1.5 billion, with the maturity of April 2024, and the contract price and the number of Ali shares are fixed; the guaranteed option financing is US $1.5 billion, which is expected to be settled in December 2023 and January 2024, and the number and lower limit of shares will refer to the stock price before the settlement date; the leader option financing is US $8.5 billion, which is expected to expire from January 2021 to September 2021, and the number of shares will refer to the settlement Calculate the stock price before the day, and set the top and bottom prices accordingly.

In 2016, Softbank said it would sell $7.9 billion worth of Alibaba shares in order to reduce its liabilities and optimize its capital structure. Before that, Softbank, as the largest institutional shareholder of Ali, held nearly 800 million shares of Ali, accounting for nearly 32% of the total shares. But Softbank actually sold $10 billion worth of shares that year, and then its share of Alibaba fell to 27%.

According to the latest financial report of Alibaba, Softbank is the largest shareholder of Alibaba, occupying Alibaba, according to wind data 25.2% The second shareholder is Ma Yun, accounting for 6%. According to the market value of the press release date (May 19), the value of Softbank holding Alis equity is as high as 145.5 billion US dollars. In other words, Softbank is still Alibabas largest shareholder, even if it reduces its holdings by $11.5 billion.

It is worth noting that at the performance conference, in addition to officially announcing plans to use Alibabas equity to raise funds, Softbank also announced that Alibaba founder Ma Yun will resign as a director of Softbank at the June 25 general meeting of shareholders.

Ma Yun is a friend of my life, and we often share our views with each other. In fact, about six months ago, Jack (Ma Yun) resigned as Alibabas chief executive. Zhang Yong takes over as CEO, Jack has not been on the front line of their business. Sun Zhengyi said. After retiring from the board of directors of Softbank group, he (Ma Yun) said to me that it was his own decision. Im very sorry, but we still keep in touch, until the outbreak, we meet every month to have dinner, talk about business, talk about life. I believe that we will be good friends all our lives, he added. In fact, Ma Yun is not the first director of Softbank to resign. Just at the end of December last year, Softbank group issued a statement. Liu Jing, CEO of UNIQLOs parent company, announced that he would quit the board of directors of Softbank group. He has been a director of Softbank for 18 years. According to relevant reports, Liujing has expressed dissatisfaction with the investment in Wework. Source: e company editor in charge: Zhong Qiming_ NF5619

Ma Yun is a friend of my life, and we often share our views with each other. In fact, about six months ago, Jack (Ma Yun) resigned as Alibabas chief executive. Zhang Yong takes over as CEO, Jack has not been on the front line of their business. Sun Zhengyi said.

In fact, Ma Yun is not the first director of Softbank to resign. Just at the end of December last year, Softbank group issued a statement. Liu Jing, CEO of UNIQLOs parent company, announced that he would quit the board of directors of Softbank group. He has been a director of Softbank for 18 years. According to relevant reports, Liujing has expressed dissatisfaction with the investment in Wework.