SoftBank launches Spac and can buy one of its own investments

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SoftBank has asked to raise up to $ 604 million for a special purpose acquisition company, saying the vehicle could acquire a company the Japanese conglomerate has previously invested in through its $ 100 billion Vision fund.

The Spac, called SVF Investment Corp, is SoftBank’s attempt to capitalize on the investment enthusiasm for blank check lists. The vehicle is sponsored by SoftBank Investment Advisers, the unit that manages its Vision Fund and is headed by Rajeev Misra, a former executive at Deutsche Bank.

It would be launched on the Nasdaq in New York, the company said on Monday.

SoftBank has said in a regulatory filing that it will seek an acquisition in a “technology sector,” citing telecommunications, artificial intelligence and software as possibilities.

“We will use our in-depth sourcing, due diligence and investment execution experience to identify and complete a combination with an exceptional business,” he said.

SoftBank has said it is not prohibited to combine Spac with a company linked to its Vision Fund, but said it would obtain independent advice from advisers on the fairness of such a transaction.

SoftBank joins a number of other investment firms, such as private equity group Apollo Global Management and Bill Ackman’s hedge fund Pershing Square, which sponsored Spacs this year and are now seeking merger deals.

Some 235 vehicles were listed on U.S. stock exchanges this year, raising $ 74.8 billion, according to data provider Refinitiv.

The phenomenon has come under scrutiny, with some critics arguing that going public via a Spac offers less transparency and higher costs than a traditional initial public offering.

SVF Investment Corp’s launch comes as SoftBank shares hit a 20-year high on Monday, spurred on by founder Masayoshi Son’s strategy of buying back shares with the proceeds from selling portions of the portfolio. of the group.

The recovery marks a dramatic reversal in fortunes from March, when SoftBank shares collapsed along with the rest of the market on learning there would be global lockdowns to curb the spread of the coronavirus.

As the market collapsed, SoftBank’s plans to list the companies it had supported through its Vision Fund looked troubled. But the surge in tech-related stocks during 2020 improved his fortunes and allowed SoftBank-backed companies, including food delivery group DoorDash, to successfully list through the IPO market.

Opendoor, an online real estate startup backed by SoftBank, debuted on Nasdaq on Monday after completing a $ 4.8 billion merger with Social Capital Hedosophia II, a Spac set up by the former Facebook executive Chamath Palihapitiya and British investor Ian Osborne.

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