SoftBank Halts New Investments in China

Japanese investment giant SoftBank Group plans to pause new investments in China until the impact of regulatory actions against the country’s tech firms becomes more clear, the Wall Street Journal reported on Wednesday.

SoftBank runs the $100 billion Vision Fund, which has invested in many world-renowned Chinese start-ups, including internet giants such as Alibaba, Didi Global and ByteDance. However, due to the anti-monopoly supervision since this year, the share prices of these internet companies have fallen, leading to a huge loss of SoftBank’s investment income.

Masayoshi Son, chairman of SoftBank Group, said, “We want to wait and see before the situation is clearer. In a year or two, I believe new rules will create a new landscape.”

Navneet Govil, CFO of Vision Fund, stated that although the crackdown has affected expectations on returns, “our broader thesis about China remains unchanged: this is still a large, growing and compelling economic opportunity”.

SoftBank previously posted its 2021 Q1 net profit of 761.5 billion yen, down by 39% year-on-year.

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