SoftBank billionaire Masa Son stores cash for ‘worst case’

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While effective vaccines and Covid-19 treatments may soon arrive, the CEO of SoftBank has said he is pessimistic about the second and third wave epidemics currently unfolding around the world.

“In the next two [to] three months, any disaster could happen, ”Son said on Tuesday, speaking from Tokyo at the New York Times Dealbook conference held online this year.

“This is the first time in our history to liquidate most of the assets as quickly as possible,” he said.

Before mass distribution of coronavirus treatments or a vaccine becomes available, “a big business could crash” and cause a “domino effect” in related industries, he said, using the Lehman Brothers collapse to illustrate his point.The fall of a single bank shook the entire banking industry and caused a global stock market crash, he said.

“I always want to be prepared for the worst-case scenario, which is why today we ourselves have nearly $ 80 billion in cash,” Son said.

Some of that stock has already been used to buy back shares of SoftBank, which Son has repeatedly lamented were undervalued by investors.

The tech mogul is also investing in established tech companies, an initiative he insisted on the consistency of his long-term strategy of betting on the next revolution in artificial intelligence.

Companies like Google (GOOGL), Amazone (AMZN), Facebook (FB) and Apple (AAPL), he said, are key players in the development of AI.

“Unicorn, public or private, [it] has no importance. I just want to bet for the AI ​​revolution, ”Son said.

Some bets have already gone bad. SoftBank last week reported losses of 131.7 billion yen ($ 1.3 billion) “from investing in listed stocks and other instruments” for the six months ended September. In a presentation of the results, Son described his company’s latest strategy of investing in highly liquid blue chip companies and derivatives as “a pilot program”.

The founder of SoftBank is best known for investing huge sums of money in private tech startups, a strategy that over the years has reaped both huge rewards and public embarrassment.

Son’s most famous investment was $ 20 million Alibaba (BABA) 20 years ago – a bet that was worth $ 60 billion when the Chinese e-commerce company went public in 2014. More recently it was chased by a disastrous investment in WeWork which resulted in SoftBank had to bail out the office startup with an expensive bailout program.

“We made a lot of losses investing in WeWork, billions of dollars. And that’s my mistake, ”Son said.

“But fortunately we have another success [investments]. So in total score we’re still positive, ”he said, adding that he remains hopeful that the Vision Fund will bring even more money to Softbank.

The huge Saudi-backed tech investment vehicle posted gains of 141.4 billion yen ($ 1.4 billion) for the six months ended in September after selling shares in four companies and cashed in six more, SoftBank said in a filing last week. The file did not reveal which companies the fund left from.

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