Skip to main content

Softbank launches $41bn asset sale to stem losses

(Image credit: Image Credit: Flickr / [puamelia])

Japanese multinational conglomerate SoftBank Group has announced plans to sell roughly $41 billion in assets, as it looks to cut losses caused by the coronavirus outbreak.

The group intends to buy back shares worth up to two trillion yen ($18.1 billion) which, combined with an earlier buyback announcement, would involve the repurchase of roughly 45 percent of its stock.

The measures are designed to bring about significant debt reductions, including bond buybacks, and further strengthen the company's balance sheet and credit rating.

Masayoshi Son, SoftBank CEO, said the move represents "the largest share buyback and will result in the largest increase in cash balance in the history of SBG."

"[SoftBank] believes its shares are substantially undervalued and as of the end of last week traded at a 73 percent discount to their intrinsic value, the largest discount in the company's history," said the conglomerate.

The company's shares rose almost 20 percent on the news, while the shares of Alibaba (in which Softbank holds a $140bn stake) fell 7 percent, suggesting the e-commerce firm could be included in the discarded assets.