SoftBank Group Shares Fall By 8% On Monday As The Value Of Its Portfolio Companies Continue To Slide

On Monday, shares of Japanese multinational conglomerate company SoftBank Group were down by over 8 percent as the shares of its portfolio companies suffered losses.

Softbank Group’s shares fell from 5201 yen ($46) to 5103 yen ($45) on the Tokyo stock market, falling as low as 5,062 yen at some point – its lowest since June 2020. The fall in prices of SoftBank Group shares comes at a time of regional sell-off of tech stocks in Asia and is the company’s seventh consecutive day of losses. Chinese e-commerce titan Alibaba, which is SoftBank’s most valuable company, saw its market capitalization slide by billions of dollars following its reorganization announcement.

Alibaba announced that the company’s former chief financial officer Maggie Wu will step down in April next year and will be replaced by Toby Xu who is Alibaba’s incumbent deputy chief financial officer. It also announced plans to form two new units for its e-commerce business – the international digital commerce and China digital commerce units. Following the announcement, its Hong Kong traded stock fell by more than 8 percent.

Apart from Alibaba, ride-hailing company Didi, is another valued company of SoftBank’s. Last week, the ride-hailing giant announced plans to delist from the New York Stock Exchange less than six months after the company was first listed, adding that it wanted to relist on the Hong Kong Stock Exchange. Since its initial public offering on the 30th of June, Didi shares have plummeted 57 percent and closed at $7.80 on Friday.

That’s not the final blow for SoftBank as the sale of its UK-based chip designer Arm to Nvidia is looking unlikely to happen as a result of regulatory scrutiny. According to Bloomberg, SoftBank had initially agreed to sell the company for $40 billion but the price of the deal went up following a surge in Nvidia’s share price. SoftBank will, therefore, be missing out on a big payout if the deal is cancelled.

Speaking on its current situation, SoftBank’s CEO Masayoshi Son said that “We are in the middle of a blizzard”, which the company was not proud of.

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