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SoftBank sells much of its stake in ride-sharing group Uber as the world’s most aggressive tech investor grapples with heavy losses from its other big bet on Chinese Didi Chuxing, according to two people familiar with the matter.
The Japanese conglomerate behind the $ 100 billion Vision Fund will aim to sell around 45 million of its shares in Uber, said one of the people, who rose to 184 million after selling 38 million shares Uber for around $ 2 billion in January. The other person said more shares were offloaded in June and the latest transaction would bring SoftBank’s stake to less than 100 million shares.
SoftBank’s investment in Uber dates back to 2017, when it agreed to pay around $ 7.7 billion for 15% of the US group’s shares, although the stake was later transferred to the Vision Fund.
Following Uber’s initial public offering in 2019, the fund made several disposals, bringing its stake in Uber to less than 10% at the end of June, according to calculations by the Financial Times.
A person familiar with the transaction said the latest sale was unrelated to China’s recent regulatory crackdown on ridesharing group Didi, which at one point put the Fund’s $ 4 billion investment in Vision in the red. Another person said the sale was decided after the Didi share price collapsed this month.
The news, which was first reported by CNBC, caused Uber’s shares to drop 4% in after-market trading in the United States. SoftBank stock rose briefly 3% during the Tokyo session on Thursday.
After a successful quarter for the Saudi Arabia-backed $ 100 billion Vision Fund and its $ 40 billion estate fund in the first three months of the year, SoftBank’s fortunes reversed with its investments in China hit hard by the country’s regulatory crackdown on the technology sector.
According to estimates by Redex Research Advisory, the value of listed holdings of the two Vision Funds is down $ 11 billion since the start of the quarter that began in July, compared to a gain of $ 1.1 billion in the quarter. from April to June.
“SoftBank has boasted [the] The flywheel of Vision Fund’s IPO and four of the last six listings were Chinese, but that will fade as the reality of China’s crackdown sets in, ”said Kirk Boodry, technical analyst at Redex.
Didi’s market value at one point fell to 50% of its post-IPO peak after Chinese regulators announced a data security investigation on the company after it was listed in New York earlier this month. The Vision Fund is Didi’s largest shareholder with 20.1% of the capital, while Uber also holds 12% of the capital of the Chinese group.
A few days after the launch of the Didi investigation, Chinese cyberspace regulators turned to the logistics group Full Truck Alliance backed by Vision Fund, causing its listed shares in the United States to fall.
More recently, the Vision Fund’s investments in Chinese online education companies such as Zhangmen, Zuoyebang and VIPThink have been overshadowed by new regulations that prohibit companies that teach curriculum subjects from making a profit.
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