SoftBank Group Corp. secured the first capital commitment to a $100 billion fund with Saudi Arabia and Abu Dhabi that would eventually put its founder Masayoshi Son in charge of one of technology’s biggest investment vehicles.
The Japanese telecom conglomerate is investing $28 billion and has agreements with Saudi Arabia’s Public Investment Fund, Abu Dhabi’s Mubadala Investment Co. and Apple Inc. With more than $93 billion committed, the fund — which includes Qualcomm Inc., Foxconn Technology Group and Sharp Corp. — aims to reach $100 billion within six months, SoftBank said in a statement Saturday. Mubadala committed $15 billion, according to a separate statement.
The Vision Fund will seek long-term investments in businesses aimed at innovation. SoftBank has relied on borrowing and earnings from its domestic telecom operations to pay for investments in startups in India, U.S. and China while dealing with losses at U.S. subsidiary Sprint Corp. By tapping outside investors, billionaire Son will be able to cut more ambitious deals than he could on his own.
“SoftBank has long made bold investments in transformative technologies and supported disruptive entrepreneurs,” Son said in the statement. “The SoftBank Vision Fund is consistent with this strategy and will help build and grow businesses creating the foundational platforms of the next stage of the Information Revolution.”
Khaldoon Khalifa Al Mubarak, chief executive officer of Mubadala, said the SoftBank fund “perfectly complements” the company’s strategy to become an investor in high-growth technology companies.
Son has made tens of billions from investments in companies including Alibaba Group Holding Ltd., Yahoo and Supercell Oy, and the new fund will likely pursue a similar strategy of backing technology companies at all stages. The focus may well be the U.S. after Son met with President Donald Trump in December and pledged to create 50,000 new jobs by investing $50 billion in startups and new companies.
Among the fund’s first investments are an acquisition of a 25 percent stake in SoftBank’s ARM Holdings Plc and its investment in satellite startup OneWeb Ltd.
SoftBank Vision Fund will be based in West London’s Mayfair. The Japanese company named Rajeev Misra, its head of strategic finance, to lead the project. Jonathan Bullock, chief operating officer of SoftBank International, and Alok Sama, SoftBank’s chief financial officer, have also been appointed senior advisers.
The shares of SoftBank are up about 25 percent since the fund was announced in October, buoyed by the prospects it would ease the strain on the Japanese company’s balance sheet. Son’s appetite for deals has left SoftBank with a record $130 billion debt load, one of the heaviest in Japan.