Softbank aims to sell majority of its stake in Alibaba: FT

SOFTBANK Group is moving to sell the majority of its stake in Chinese Internet giant Alibaba Group Holding, the Financial Times reported on Wednesday (Apr 12).

SoftBank has sold more than US$7 billion in Alibaba shares this year through prepaid forward contracts, after selling US$29 billion last year, according to the newspaper. The contracts give SoftBank the option to buy the shares back, but the group has settled previous deals by handing over the stock, the Financial Times reported.

The sales will reduce the Japanese conglomerate’s ownership of Alibaba to less than 4 per cent, the paper said, citing its analysis of regulatory filings. SoftBank once owned about a third of the company, an investment that performed spectacularly well — until it didn’t.

Alibaba has come under intense scrutiny from the Chinese government in recent years, and its stock price has tumbled. Last month, the online commerce leader said it plans to split its US$220 billion empire into six units that will individually raise funds and explore initial public offerings.

SoftBank, once one of Silicon Valley’s largest investors, has seen losses in recent years on other companies, too. It cut staff in its famous Vision Fund unit last year, amid a larger technology downturn, and it was an investor in failed crypto startup FTX.

This week, SoftBank said it plans to sell its early-stage venture capital arm SoftBank Ventures Asia after losing billions on startup investing.

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Over the past 14 months, SoftBank brought in an average of US$92 a share from the forward sales of 389 million Alibaba shares, the Financial Times said. That value is much less than the company’s all-time high of US$317 a share, it said.

SoftBank did not immediately respond to a request for comment. BLOOMBERG