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SoftBank Fund said in talks with Canada, Mideast for cash

Sunday, June 4, 2017 - 22:35

[LONDON] Softbank Group Corp is in discussions with potential investors in Canada and the Middle East to raise US$7 billion of additional capital for its technology fund, according to people familiar with the matter.

The Japanese company is in talks with Canadian pension funds, sovereign wealth funds in Kuwait and Qatar and technology companies, the people said, asking not to be identified as the discussions are ongoing. The new commitments would take the total pool to US$100 billion, though there's no guarantee that the parties will reach an agreement, they said.

The Vision Fund will charge a performance fee of 20 per cent and a management fee of 0.5 per cent to 1 per cent, the people said. That compares to private equity firms, which typically charge 2 per cent of the assets they oversee, plus 20 per cent of profits. SoftBank plans to hire about 50 people this year to help manage its investments, the people said.

Representatives for SoftBank and the Qatari wealth fund declined to comment, while no one at the KIA was available to comment.  Fund Firepower SoftBank and Saudi Arabia formally announced the first round of capital commitments for the largest-ever technology investment fund last month, giving the Japanese company's founder, Masayoshi Son, the firepower to accelerate investments in cutting-edge technologies and startups.

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More than US$93 billion has been secured from backers led by the Japanese company and Saudi Arabia's Public Investment Fund. Abu Dhabi's Mubadala Investment Co, Apple Inc, Qualcomm Inc, Foxconn Technology Group and Sharp Corp are also investing.

Mr Son, who has vowed to become the biggest investor in the technology industry over the next decade, has already started making good on that promise. In May, SoftBank invested US$5 billion in Chinese ride-hailing giant Didi Chuxing and put US$1.4 billion into digital payments startup Paytm, the largest-ever funding round from a single investor in India's technology sector.

SoftBank also quietly amassed a US$4 billion stake in Nvidia Corp making it the fourth-largest shareholder in the graphics chipmaker, people familiar with the matter have said.

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