(Reuters) – Japanese investment firm SoftBank Group Corp (9984.T) has moved to sell nearly all of its remaining shares in China’s Alibaba Group Holding Ltd (9988.HK), the Financial Times reported, citing regulatory filings it analyzed. .
Shares in Alibaba, one of the most valuable assets in SoftBank’s portfolio, fell as much as 5.1% in Hong Kong after the report before narrowing the loss to 3.3%. SoftBank shares traded flat, following the broader market (.N225).
The forward sales, which the Financial Times analyzed based on filings sent to the US Securities and Exchange Commission, would eventually reduce SoftBank’s stake in the e-commerce group to just 3.8%, the British newspaper reported. mentioned Wednesday.
The newspaper said that the Japanese group, led by billionaire founder Masayoshi Son, sold about $7.2 billion worth of Alibaba shares this year through paid forward contracts.
SoftBank has been looking for ways to monetize its stake in Alibaba, which the Japanese conglomerate bought more than two decades ago with just $20 million spent.
Alibaba’s transactions reflect its shift to “defensive mode” to address a more uncertain business environment, SoftBank told the FT, and said the company would provide details in its quarterly earnings results announcement in May.
Neither SoftBank nor Alibaba responded to Reuters requests for comment. US-listed Alibaba shares fell 1.3 percent in after-market trading.
SoftBank gained $34 billion last year by reducing its stake in Alibaba to 14.6% from 23.7%, as the company sought to boost its cash reserves amid huge losses incurred at the Vision Fund.
At that time, he also used a prepaid futures contract, which is a type of derivative contract that allows an investor to hedge the risks associated with an equity investment in a company.
Alibaba has lost more than two-thirds of its value from the highs it touched in late 2020, hit by mounting regulatory action in the technology sector that included a hefty fine on Alibaba and scrutiny of founder Jack Ma’s business empire.
Additional reporting by Yuvraj Malik in Bengaluru; Editing by Krishna Chandra, Elory and Christopher Cushing
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