Hedge fund Elliott builds $3 bn stake in SoftBank
NEW YORK: Hedge fund Elliott Management Corp., one of the world’s most powerful activist investors, has amassed a nearly $3 billion stake in SoftBank Group Corp and is pushing for changes to boost the Japanese conglomerate’s value, people aware of the matter said.
Elliott’s involvement is likely to cast new light on SoftBank’s financial track record, which has been scrutinized heavily by investors after several of its expensive bets on startups around the world, including WeWork, soured.
The New York-headquartered hedge fund has owned SoftBank shares for years but late last year grew its stake into one of its largest-ever positions in a company, the sources said. Elliott now owns roughly 3% of SoftBank, the sources added.
SoftBank has been vulnerable to investor criticism that its stock trades at a deep discount to the value of its holdings.
Its shares jumped 8% on Friday morning in Tokyo, giving the conglomerate a market capitalization of roughly $95 billion.
The value of its stakes in Alibaba, Sprint and its Japanese telecom business is roughly $210 billion.
Elliott, which oversees $40 billion in assets, has held discussions with SoftBank’s management and is calling on the company to buy back some $20 billion of its stock, improve its governance by increasing the independence and diversity of its board and improving transparency, the sources said.