SoftBank, the Japanese company, has received regulatory approval from the Tokyo Stock Exchange for the initial public offering (IPO) of its mobile unit, reported the Financial Times.
According to a report in the Financial Times, the $21 billion initial public offering is slated for December 19 and is being marketed largely to Japanese retail investors who have been allocated slightly more than 87 percent of all the new shares being issued. Factoring in the overallotment, the IPO could raise $23.8 billion, which is close to the $25 billion Alibaba raised in its IPO back in 2014, noted the Financial Times. If it is able to raise $21 billion, the mobile unit of SoftBank IPO would be close to the $22 billion raised by Agricultural Bank of China in 2010 and the $21.9 billion raised in 2006 by Industrial and Commercial Bank of China.
The IPO is seen as a big shift for SoftBank and its founder, who built the company’s mobile unit via a 2006 acquisition of Vodafone’s Japan unit. SoftBank Founder and CEO Masayoshi Son is trying to take the company from a telecom centered one into a global investment company with the $100 billion Vision Fund it created a few years back. With the Vision Fund becoming a bigger driver of profit for SoftBank than its mobile business some investors have questioned separating it from its other cash cows, noted the report. Since its launch, the Vision Fund has made investments in roughly 300 companies, including in the artificial intelligence (AI) and Internet of Things (IoT) markets.
In late June the Nikkei Asian Review reported SoftBank was eyeing an IPO for its telecom unit, saying the move is aimed at raising capital so it can continue on its path to becoming a technology investment company. The report noted at the time that the IPO is expected to draw investors on the merits of the wireless carrier business, given it has stability in terms of earnings.