SoftBank Group is debating a new strategy to go private by gradually buying back outstanding shares until founder Masayoshi Son has a big enough stake he can squeeze out the remaining investors.
The approach would likely take more than a year and would mean the Japanese company continues to sell assets to fund successive buybacks, according to people familiar with the matter.
Mr Son would not buy more shares himself, but his ownership stake, now about 27 per cent, would increase as other investors sell stock. Under Japanese regulations, Mr Son could compel other shareholders to sell when he gets to 66 per cent ownership, perhaps without paying a premium, the people said.
One advantage of the plan, which insiders have called a “slow-motion” or “slow-burn” buyout, is that it gives SoftBank flexibility to purchase its own stock when it dips, according to the people. In the case of a formal buyout, it would have to pay a premium, likely of around 25 per cent. Shareholders are also likely to support buybacks, especially since the company continues to trade at a discount to the total value of its holdings in companies from Alibaba and Uber to DoorDash.
The billionaire said as recently as February he thought SoftBank was better off as a public company. More recently, he has declined to comment on his plans after reports about a possible buyout in publications, including Bloomberg News.
“If our shares drop down, I will buy back more shares more aggressively,” Mr Son said at a conference in November. SoftBank declined to comment for this story.
Shares rose as much as 6.7 per cent after Bloomberg’s report.
Mr Son has debated the idea of going private off and on for at least five years. Even with SoftBank’s market capitalisation at about $50 billion and its assets worth three times that, banks proved hard to convince. They offered unfavorable terms, torpedoing the talks, a person involved in the negotiations has said.
Instead, Mr Son unveiled plans to sell about $43bn in assets to pay down debt and buy back stock. By June, he had offloaded $13.7bn of Alibaba stock, an even larger chunk of its stake in T-Mobile US and some shares of SoftBank, his Japanese telecommunications unit. He then went even further, announcing the sale of Arm to Nvidia for about $40bn, slashing the stake in SoftBank by about a third and selling a controlling shareholding in phone-distribution company Brightstar.
Mr Son says he is now sitting on $80bn in cash. The robust initial public offering market has also given SoftBank some big gains on investments, including China’s KE Holdings and DoorDash.
SoftBank’s market value has surged however, with a rally of more than 160 per cent since its low in March. The value of the stock outside of his control is about $87bn.
SoftBank is not obligated to publicly disclose buyout plans, unless it takes concrete steps like setting up a special committee to review the bid or getting letters of intent from the banks for financing, according to one of the people familiar. The disclosure rules in Japan, where management buyouts are rare, have gray areas that would give SoftBank room to maneuver, the person said.
Mr Son may still do a traditional management buyout if the share price falls below a certain level, one of the people said, declining to give specific numbers. Elliott, SoftBank’s biggest external shareholder, would take part, provided the stock is still trading at a discount to its underlying value, according to a different person. The Japanese conglomerate is also less leveraged today and a much easier vehicle to lend to for the banks than it was in March, the person said.
After repurchasing 1.35 trillion yen ($12.95bn) of shares this year, SoftBank holds about 12 per cent of outstanding stock. Mr Son controls about 26.8 per cent through various entities. The company has already announced plans to buy back 1.5 trillion yen more through July of next year. At yesterday’s closing price, that would increase Son’s share to less than 35 per cent, a long way to go until a decisive majority.
Some analysts are skeptical Mr Son would pursue a buyout now given such challenges – and his propensity to use any cash he has for ambitious deals.
“Until this year, Son has shown little appetite for tackling the discount with buybacks,” said Atul Goyal, senior analyst at Jefferies. “Are we supposed to believe that he will now spend years and all of SoftBank’s cash on this scheme, instead of doing what he really loves – making big bets in the tech space?”
The problem with a slow-burn MBO strategy is that the buybacks are likely to raise the cost of the eventual deal, according to Mr Goyal. Even if Mr Son manages to raise his personal stake in the company to 66 per cent, Mr Goyal is not convinced he will be able to pull off the buyout without a challenge from minority shareholders.
Many inside SoftBank are also against the idea of going private. The sheer amount of cash required is one obstacle. Going private is also likely to cause blowback from credit-rating agencies, making the refinancing of billions of dollars in corporate bonds more difficult, one person said. A buyout would actually prevent Mr Son from doing big deals for as long as a year and a half, one factor giving him second thoughts, a different person said.
In February, when he addressed the idea of a buyout, Mr Son said he decided against pursuing a deal after giving it serious consideration. Keeping SoftBank public would allow shareholders to participate in the company’s growth and enforce management discipline, including transparency, he said at the time.
UAE currency: the story behind the money in your pockets
In numbers
1,000 tonnes of waste collected daily:
- 800 tonnes converted into alternative fuel
- 150 tonnes to landfill
- 50 tonnes sold as scrap metal
800 tonnes of RDF replaces 500 tonnes of coal
Two conveyor lines treat more than 350,000 tonnes of waste per year
25 staff on site
Killing of Qassem Suleimani
Killing of Qassem Suleimani
Killing of Qassem Suleimani
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
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The specs: 2018 Maserati GranTurismo/GranCabrio
Price, base Dh485,000 (GranTurismo) and Dh575,000 (GranCabrio)
Engine 4.7L V8
Transmission Six-speed automatic
Power 460hp @ 7,000rpm
Torque 520Nm @ 4,750rpm
Fuel economy, combined 14.3L (GranTurismo) and 14.5L (GranCabrio) / 100km
Warlight,
Michael Ondaatje, Knopf
UAE currency: the story behind the money in your pockets
Business Insights
- As per the document, there are six filing options, including choosing to report on a realisation basis and transitional rules for pre-tax period gains or losses.
- SMEs with revenue below Dh3 million per annum can opt for transitional relief until 2026, treating them as having no taxable income.
- Larger entities have specific provisions for asset and liability movements, business restructuring, and handling foreign permanent establishments.
What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
The years Ramadan fell in May
Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
The Birkin bag is made by Hermès.
It is named after actress and singer Jane Birkin
Noone from Hermès will go on record to say how much a new Birkin costs, how long one would have to wait to get one, and how many bags are actually made each year.
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SPEC%20SHEET%3A%20APPLE%20IPAD%20PRO%20(12.9%22%2C%202022)
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Company%20Profile
%3Cp%3E%3Cstrong%3EName%3A%3C%2Fstrong%3E%20HyveGeo%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202023%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Abdulaziz%20bin%20Redha%2C%20Dr%20Samsurin%20Welch%2C%20Eva%20Morales%20and%20Dr%20Harjit%20Singh%3Cbr%3E%3Cstrong%3EBased%3A%20%3C%2Fstrong%3ECambridge%20and%20Dubai%3Cbr%3E%3Cstrong%3ENumber%20of%20employees%3A%3C%2Fstrong%3E%208%3Cbr%3E%3Cstrong%3EIndustry%3A%20%3C%2Fstrong%3ESustainability%20%26amp%3B%20Environment%3Cbr%3E%3Cstrong%3EFunding%3A%20%3C%2Fstrong%3E%24200%2C000%20plus%20undisclosed%20grant%3Cbr%3E%3Cstrong%3EInvestors%3A%20%3C%2Fstrong%3EVenture%20capital%20and%20government%3C%2Fp%3E%0A
Global state-owned investor ranking by size
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1.
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United States
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2.
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China
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3.
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UAE
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4.
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Japan
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5
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Norway
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6.
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Canada
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7.
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Singapore
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8.
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Australia
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9.
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Saudi Arabia
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10.
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South Korea
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Global Fungi Facts
• Scientists estimate there could be as many as 3 million fungal species globally
• Only about 160,000 have been officially described leaving around 90% undiscovered
• Fungi account for roughly 90% of Earth's unknown biodiversity
• Forest fungi help tackle climate change, absorbing up to 36% of global fossil fuel emissions annually and storing around 5 billion tonnes of carbon in the planet's topsoil
Match info
Australia 580
Pakistan 240 and 335
Result: Australia win by an innings and five runs
Buy farm-fresh food
The UAE is stepping up its game when it comes to platforms for local farms to show off and sell their produce.
In Dubai, visit Emirati Farmers Souq at The Pointe every Saturday from 8am to 2pm, which has produce from Al Ammar Farm, Omar Al Katri Farm, Hikarivege Vegetables, Rashed Farms and Al Khaleej Honey Trading, among others.
In Sharjah, the Aljada residential community will launch a new outdoor farmers’ market every Friday starting this weekend. Manbat will be held from 3pm to 8pm, and will host 30 farmers, local home-grown entrepreneurs and food stalls from the teams behind Badia Farms; Emirates Hydroponics Farms; Modern Organic Farm; Revolution Real; Astraea Farms; and Al Khaleej Food.
In Abu Dhabi, order farm produce from Food Crowd, an online grocery platform that supplies fresh and organic ingredients directly from farms such as Emirates Bio Farm, TFC, Armela Farms and mother company Al Dahra.
Seemar’s top six for the Dubai World Cup Carnival:
1. Reynaldothewizard
2. North America
3. Raven’s Corner
4. Hawkesbury
5. New Maharajah
6. Secret Ambition
THE SPECS
Engine: Four-cylinder 2.5-litre
Transmission: Seven-speed auto
Power: 165hp
Torque: 241Nm
Price: Dh99,900 to Dh134,000
On sale: now
Company profile: buybackbazaar.com
Name: buybackbazaar.com
Started: January 2018
Founder(s): Pishu Ganglani and Ricky Husaini
Based: Dubai
Sector: FinTech, micro finance
Initial investment: $1 million
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
BABYLON
%3Cp%3EDirector%3A%20Damien%20Chazelle%3C%2Fp%3E%0A%3Cp%3EStars%3A%20Brad%20Pitt%2C%20Margot%20Robbie%2C%20Jean%20Smart%3C%2Fp%3E%0A%3Cp%3ERating%3A%204%2F5%3C%2Fp%3E%0A
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
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T20 World Cup Qualifier
October 18 – November 2
Opening fixtures
Friday, October 18
ICC Academy: 10am, Scotland v Singapore, 2.10pm, Netherlands v Kenya
Zayed Cricket Stadium: 2.10pm, Hong Kong v Ireland, 7.30pm, Oman v UAE
UAE squad
Ahmed Raza (captain), Rohan Mustafa, Ashfaq Ahmed, Rameez Shahzad, Darius D’Silva, Mohammed Usman, Mohammed Boota, Zawar Farid, Ghulam Shabber, Junaid Siddique, Sultan Ahmed, Imran Haider, Waheed Ahmed, Chirag Suri, Zahoor Khan
Players out: Mohammed Naveed, Shaiman Anwar, Qadeer Ahmed
Players in: Junaid Siddique, Darius D’Silva, Waheed Ahmed
THE%20SPECS
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F1 The Movie
Starring: Brad Pitt, Damson Idris, Kerry Condon, Javier Bardem
Director: Joseph Kosinski
Rating: 4/5
Indoor cricket in a nutshell
Indoor Cricket World Cup - Sep 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
