SoftBank is selling about a third of its stake in rideshare Uber, in part to cover losses on its investment in Chinese ridesharing company Didi, two people familiar with the matter told CNBC. It plans to sell 45 million shares that have a 30-day vesting period.
Uber stocks fell 5% in expanded trading following the report.
The value of Uber’s own Didi stake fell by $ 2 billion last week after Didi’s American Depositary Shares debuted on the New York Stock Exchange in June as China reportedly planned fines and other penalties against the company, amid broader crackdown on US-listed Chinese companies.
According to CNBC’s Deirdre Bosa, SoftBank lost about $ 4 billion in total to its Didi position. It also suffered from a drop in Alibaba valuation, the Ant Group’s botched IPO, and paused plans for a ByteDance listing. In addition, Softbank’s Masayoshi Son is increasingly playing in public markets with his SB Northstar unit.
The news comes a week after Uber stock rose slightly after the company’s trucking division announced it was acquiring shipping software company Transplace from TPG Capital for approximately $ 2.25 billion.
Didi stock is down 37% from its closing price of $ 14.14 on the stock’s first day of trading, June 30th. Over the same period, Uber stocks are down about 8%.
SoftBank’s own shares have also fallen since Didi US went public. The SoftBank Vision Fund held 21.5% of Didi after its listing in the US.
In 2018 SoftBank invested in Uber. In 2019, the SoftBank Vision Fund invested an additional $ 333 million in Uber. As recently as March 31, Uber described SoftBank as a “major shareholder”.
Many people called SoftBank’s Uber stock purchase a failed investment, SoftBank CEO Masayoshi Son told analysts on a conference call in February, saying it was paying expensive money to a bad company.
“However,” he said, “in fact, as you can see, we have already made nearly 500 billion yen in profit from Uber.”