Dec 27, 2023 06:00 AM EST
The announcement that SoftBank Group Corp will get shares in telecom T-Mobile US valued at about $7.59 billion at no additional cost caused a 5% increase in the Japanese conglomerate's stock.
The conglomerate of Masayoshi Son said late on Tuesday that it had instructed T-Mobile US to issue 48.75 million shares of common stock to it following the fulfillment of requirements included in an agreement reached as part of the combination of T-Mobile and Sprint, the U.S. telecom owned by SoftBank.
SoftBank's portfolio gains strength through a recent transaction, resulting in a doubling of its stake in T-Mobile US from 3.75% to 7.64%. This move follows the significant listing of chip designer Arm in September. Macquarie analyst Paul Golding highlighted the impact on SoftBank's balance sheet, noting an increase in the proportion of listed, measurable equity and improved ratios of marginable equity to indebtedness.
SoftBank's stock was poised to have its largest increase in over a month. The benchmark index (.N225) has increased by about 30% year to date, whereas the conglomerate has only increased by around 14%.
Based on estimations by Macquarie, the group trades at a 45.5% discount to the value of its assets.
Son has been a prominent investor in late-stage businesses, but he has seen a number of setbacks, such as the bankruptcy of WeWork, the office-sharing company that was once the most valued startup in the United States.
SoftBank's internal rate of return (IRR) on its Sprint investment increases to 25.5% as a result of the T-Mobile US merger.
The recent surge in Arm's shares, which ended on Tuesday at a price almost 44% higher than the original public offering, is another advantage for the business.
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Recently, Qualson, the company that owns Real Class, was acquired by Riiid, a South Korean AI edtech firm supported by SoftBank Vision Fund. The sum is not known.
Through the purchase, Qualson's user base, content, and English-as-a-second-language market will be accessible to Riiid, which leverages AI to offer individualized learning and adaptive content delivery. This will increase Riid's visibility in the Asian test-prep market, where users may use their AI-powered Santa app to help them get ready for the TOEIC exam.
Through the purchase, Qualson's user base, content, and English-as-a-second-language market will be accessible to Riiid, which leverages AI to offer individualized learning and adaptive content delivery. This will increase Riid's visibility in the Asian test-prep market, where users may use their AI-powered Santa app to help them get ready for the TOEIC exam.
Additionally, organizations wishing to develop staff training programs and test prep firms can license Riiid's technology.
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