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Softbank

Company

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Japanese telecom operator. One of the largest telecom holdings of the world.
Revenue and Net Profit billions ¥

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Assets

+ Softbank

The Softbank company is a little known outside Japan, but in the native land has reputation of aggressively operating Internet conglomerate. It has the rich history of mastering of new areas and replacement of competitors at the expense of low prices, new services and unusual advertizing.

Assets

Is a part of holding including the telecom operator of SoftBank Corp.

Performance Indicators

2020: The most heavy losses in the history because of Vision Fund

According to the results of financial year which came to the end at the end of March of the 2020th calendar losses of SoftBank Group  from under control of an investment fund company of Vision Fund reached 1.8 trillion yens (about $16.7 billion). Failure investments in IT projects, led problems with WeWork and other assets to the fact that all Japanese group stopped being profitable.

For reporting year of SoftBank registered net loss in the amount of 750 billion yens whereas the previous year net profit was measured by 1.41 trillion yens. According to analysts, this the biggest monetary losses of the company from the moment of entry into the exchange in 1994 and the first net losses since 2005 of a fiscal year.

The investment fund yielded to SoftBank a loss in $16.7 billion. Investments in technology were failure

Vision Fund which is considered the world's largest fund for investment into technology startups (its amount exceeds $100 billion), brought monetary losses of SoftBank, in particular, because of "deterioration in the market environment,  unsuccessful investments into WeWork and satellite OneWeb which in March, 2020 declared bankruptcy.

In the conditions of crisis the attention of investors switched to a debt of SoftBank which already reached $55 billion, Financial Times writes. According to the edition, the founder and the actual head of SoftBank Group Masayoshi Son put to banks about 60% of the stocks of the company owned by it.

Besides, SoftBank offered for sale assets for the amount to 4.5 trillion yens ($41 billion) to spend proceeds for reduction of debts, a bond buyback and building of monetary reserves. The asset sale will be performed within the next four quarters, since March, 2020. At this SoftBank does not specify what will be sold.

On April 13, 2020, when SoftBank announced losses, stocks of the company fell in price by 3.4% to closing of the exchange. Since the beginning of year of quotation sank for 11.7%.[1]

History

2020: In Japan the ex-employee of SoftBank on the case of espionage for benefit of Russia is arrested

The Japanese police arrested the former employee of SoftBank Yutaka Araki for theft of confidential information to the operator and transfer to its Russian authorities. Read more here.

2019

Investment into WeWork is more than GDP of Bolivia

On October 23, 2019 the new chairman of the board of directors of WeWork Marcelo MarceloClaure sent to the staff of the company the e-mail in which he reported that SoftBank invested $18.5 billion in the largest kovorkingovy service - it is more than GDP of Bolivia in which there live 11.5 million people. Read more here.

Investment into division of pilotless cars of Uber

On April 19, 2019 Uber announced attraction of $1 billion investments for the division which is engaged in development of technologies for unmanned vehicles. According to the results of the financial transaction in which took part technology holding Softbank, Toyota carmaker and producer of automobile Denso component parts, Uber Advanced Technologies company it was estimated at $7.25 billion Read more here.

2018

Investment of $500 million into software developer for the analysis of behavior of drivers of Cambridge Mobile Telematics

In December, 2018 Cambridge Mobile Telematics announced attraction of $500 million investments from SoftBank corporation which founder is the richest Japanese Masayoshi Son. Money will be selected from Vision Fund which the Japanese holding created for an investment in technology projects. Read more here.

Investments into the developer of the "smart" windows managed by the View smartphone

In November, 2018 Softbank announced an investment of $1.1 billion in the developer of the "smart" View windows through the investment fund Vision Fund. The raised funds are allocated for doubling of production volume of "smart" windows at the plant in the State of Mississippi (USA) and also on further development of technology for use in even more futuristic projects. Read more here.

Investments into the system developer of video surveillance of EarthNow

In April, 2018 Softbank invested in the system developer of video surveillance behind all Earth in real time of EarthNow. Read more here.

2017

Investments into service of the order of the Uber taxi

The Japanese telecommunication conglomerate SoftBank invests billions of dollars in service of the online order of the Uber taxi within the agreement signed by the companies. Uber announced the reached agreement on November 12, 2017, but did not disclose details of the transaction. Read more here.

Purchase of the developer of Boston Dynamics robots

On June 9, 2017 the Softbank corporation announced acquisition of the developer of Boston Dynamics robots. The announcement of this transaction promoted rise in quotations of the buyer for 7.9% to a maximum of 17-year. Details here.

2016: Purchase of the developer of ARM chips for $32.2 billion - the largest acquisition in the history of the company

On July 18, 2016 SoftBank announced purchase of ARM Holdings for 24.3 billion pounds sterling ($32.2 billion). This biggest acquisition in the history of SoftBank.

The cost of the transaction counting on the stock ARM will be 17 pounds sterling that for 40% of high price of actions as of July 15, 2016. After the statement for sale of the British chipmaker of its quotation jumped by 45% to opening of the London Stock Exchange therefore market capitalization of the company made 7.56 billion pounds sterling. Read more here.

2012

Purchase of the American mobile operator Sprint Nextel for $20 billion

In October, 2012 Softbank announced intention to acquire 70% of shares of the mobile operator from the USA Sprint Nextel for 20 billion dollars. In case of a successful completion of this transaction it will lead to education of one of the largest telecommunication operators in the world.

The agreement will allow Softbank which is aggressively promoting the company services to expand presence in the market of the USA and to turn into global force, having become the third largest telecom operator of turnover in the world. Sprint the transaction will help to receive 8 billion dollars of the new capital and to considerably improve the financial position.

"Before us the widest both internal, and external opportunities for all the time of my stay in Sprint open now" — the CEO of the company Dan Hesse noted during the news conference in Tokyo. Sprint wishes to repeat in the house market the ascension similar to what was made by Softbank company, earlier being in the third place and far lagging behind leaders too. "Here to us is to what to learn from them" — Hesse[2] specified[2].

Masayoshi Son, the CEO of Softbank, said the following:

"At the solution of a difficult task you face various risks. And it will be hard for us to cope with this task in America. But we trust in the forces".
Son connects the perspectives with experience of creation of high-speed networks which the companies managed to be purchased in Japan. "In America networks work much more slowly, without reaching also a half of that speed to which we got used in Japan — he emphasized. — And in ensuring high speed we see the chance".

Analysts believe that the transaction will stir up the mobile market of the USA in which two large operators dominate today: AT&T and Verizon Wireless. The Softbank company which received the status of the mobile operator only six years ago already doubled the number of base of the subscribers in Japan, applying aggressive price policy and creative marketing.

The agreement promises monetary injections and Sprint companies which, as well as Softbank, is engaged in creation of own high-speed network. There is a sense to try to implement in the USA some technologies, already today with success the specialized payment cards and mobile television used in Japan, for example. The considerable benefit can be taken also from scales of the new enterprise.

Having purchased Sprint, Softbank will probably try to reach economy by the further growth of scales. The main phone in both companies is iPhone, in both infrastructure of Ericsson is used.

According to Hesse, Sprint already signed successful sales contracts of iPhone. These contracts promise to make profit for the next several years.

In the news arriving from Japan it is said that the management of Softbank intends to use the positions in Sprint for purchase of MetroPCS Wireless company which in the same time is actively cajoled by T-Mobile.

Kester Mann, the leading analyst of CCS Insight company, considers that transactions between Softbank and Sprint and also between T-Mobile and MetroPCS will have positive character for consumers of the USA as pressure upon Verizon and AT&T as a result will increase.

Purchase of the producer of Aldebaran Robotics robots

In 2012 the Japanese telecommunication holding Softbank purchased the French producer of robots Aldebaran Robotics. Transaction amount was $100 million Read more here.

Absorption of the competitor is eAccess, an exit to the second place in the cellular market of Japan

For 2012 Softbank remains the third largest mobile operator in Japan, however at the beginning of October the agreement with the small competing eAccess company after which acquisition for $2 billion Softbank will move to the second place to hierarchies on number of subscribers was signed.

Are a part of holding (October, 2012):

  • divisions of large operators of mobile and broadband communication and also
  • Internet assets (in particular, Yahoo Japan and Japanese UStream).

Large investments are made in foreign firms which the supplier of social games Zynga and the Chinese holding Alibaba Group are among, for example.

In the advertizing Softbank Brad Pitt and Cameron Diaz acted, tariff plans were explained to the audience by the speaking cats, and the Japanese family which head of the unclear reasons is the white dog by the name of Otosan appears in the advertizing campaign of 2012. He became famous in Japan.

2008: The pioneer of iPhone in Japan

Masayoshi Son represents iPhone in Japan in 2008

The head of the company Masayoshi repeatedly expressed the admiration of Steve Jobs and provided the first iPhone in Japan in 2008. At that time the Japanese market of cell phones was aloof, offering the mass of devices of local production which were not on sale abroad, and without having any of the foreign models popular in the rest of the world.

First analysts doubted that iPhone will be pleasant to the Japanese consumers. However over time those recognized that quality goods create not only within their country, and many local producers of mobile phones "were included into a corkscrew" after which some still were not recovered.

2006: Purchase of the Japanese Vodafone

In 2006 when the Japanese government tried to recover competitive struggle in the local market of telecommunications, Softbank at last gained trust of the authorities to obtain the license of mobile operator — in Japan for this purpose there was never enough money alone. However, despite all attempts of Softbank, more than the frequencies did not provide to it therefore the company instantly grasped chance when the management of the British operator Vodafone decided to leave the Japanese market. Vodafone appeared in Japan for several years before, having purchased local operator number three, but the European company did not manage to interest in phones of world brands and the services of whimsical Japanese subscribers.

Softbank purchased Vodafone Japan, and in read months mobile communications market received a fresh stream of the competition. The company got into heavy debts for the sake of this purchase, but it managed to pay them by sale of the share in Yahoo[3].

2001: The attack in the market of DSL Internet access

In 2001 to the largest operator of Japan Nippon Telegraph and Telephone (NTT) was necessary to feel shock. NTT just started service of an Internet access on DSL technology as suddenly the road to it was crossed by Softbank company.

Gained strength thanks to a series of well-aimed investments into Internet startups, Softbank began to create own business of Internet access, without being afraid to take up at the same time the territory of such terrible rival as NTT.

The Softbank DSL service debuted on rates twice smaller, than at NTT, having forced the largest operator and other competitors to beat down the prices too. Thanks to the active investments in the most modern Softbank technologies in read months it was succeeded to offer not only less expensive access on DSL, but also the fastest. Blitzkrieg of Softbank was followed by an aggressive marketing campaign: offered the people on streets who agreed to be connected free DSL modems.

At that time in the Japanese market of telecommunications there was practically no competitive struggle. Small independent operators usually offered rates only slightly below, than at NTT, and lower prices in the opinion of the conservative Japanese consumer were never capable to eclipse stability, scale and reliability with which the name NTT was associated. However the offer of Softbank looked too good that to refuse it.

Since the courageous entry into the Japanese market of DSL access Softbank continued in the same spirit: in the company were not afraid to throw down a challenge to large players and got used that first it is not perceived seriously. Tempting quotations and new technologies became its main tools, and the CEO Masayoshi Son without hesitation did large financial rates.

2000: Purchase of Ziff Davis media company

Among the first investments of Softbank there is an acquisition of the American publishing house Ziff Davis and formation of joint venture with the News Corp. corporation belonging to Robert Murdoch in attempt to sharply change a landscape of the market of satellite broadcasting in Japan. For the next years Softbank invested in a series of startups and for October, 2012 owns packets of the largest Chinese Internet companies Renren and Alibaba.

The 1990th: Purchase of 37% in Yahoo company

To the middle of the 1990th the company accelerated, having purchased a share block of Yahoo, the company at that time beginning. In read months Softbank increased a share in Yahoo to 37% and could expand the business thanks to steady growth of stocks of the American company.

1981: Masayoshi Son founds distributor of software and the publisher of computer magazines

The Softbank company was founded in 1981 by Masayoshi Son, her permanent leader — the charismatic entrepreneur.

The company began the activity as the software distributor and the publisher of computer magazines. The first decade of the existence of Softbank continued this business, but then started expansion.

Notes