SoftBank to invest $1.6b in China’s Didi Chuxing

In an interview with CNBC, SoftBank CEO Masayoshi Son (pictured) said the investment in Didi, which follows a $5 billion commitment in 2017 and a $7.3 billion deal in 2016 alongside other investors, reflects continued confidence in the global ride-hailing industry. SoftBank has backed several operators in the space worldwide, including Southeast Asia’s Grab – which raised $1.5 billion from the SoftBank Vision Fund earlier this year – and US-based Uber.

Although none of these operators have shown a profit yet, SoftBank believes the underlying business model is robust. Once they shift focus from customer acquisition and creating the necessary infrastructure, they should be able to generate a healthy profit fairly quickly.

Son also discussed the Vision Fund, which launched in 2016 and reached a first close of $93 billion in 2017. He said the fund has invested around $70 billion in a wide range of public and private technology companies, adding that it has the potential to extend its investments beyond the $100 billion target corpus through leverage. SoftBank is in talks with LPs to back a potential successor to the Vision Fund, but has not yet set a target.

In addition, Son addressed the role of Saudi Arabia’s Public Investment Fund (PIF), which contributed $45 billion to the Vision Fund but, he says, plays no role in its investment decisions. SoftBank has faced criticism over its involvement with PIF after the murder of journalist Jamal Khashoggi by government operatives linked to crown prince Mohammed bin Salman.

In previous statements, Son has condemned the killing but said the fund will continue to invest the money contributed by PIF, and has not ruled out accepting Saudi investment in future installments of the Vision Fund.

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• Topics
• GPs
• Greater China
• Technology
• Consumer
• Expansion
• Softbank
• China
• Didi Chuxing
• TMT
• automobiles