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SoftBank Sells 25% ARM Stake to Its $100 Billion Vision Fund

Joseph Lu

SoftBank Group Corp. SFTBY, the Japanese telecom giant, is looking to sell 25% stake in ARM Holdings Plc, the British chip designer, to the company founder’s new investment fund.

SoftBank, led by Japanese billionaire Masayoshi Son, acquired ARM last year for $32 billion, and bought Fortress Investment FIG in February for $3.3 billion in cash. These moves by Mr. Son are trying to secure further investment for Vision Fund, the $100 billion technology investment company that will be based in London.

ARM, which designs the microchips in Apple’s AAPL iPhones and many other internet-connected devices, is a bet on the future of connected devices. The Japanese company is looking to receive about $8 billion from the shares if the sale goes through. The stakes are being sold to Vision Funds, which Mr. Son has created with Saudi Arabia and other investors.

Mr. Son is currently in the process of reaching that $100 billion goal with Saudi Arabia investors. If the financial goal is reached, Vision Fund and Mr. Son will be the largest technology investor in the world.

Reported by The New York Times, Saudi Arabia’s Public Investment Fund has pledged to invest $45 billion, while Softbank has contributed $25 billion. Apple and Lawrence Ellison, a co-founder of Oracle ORCL, are also minor investors of the Vision Fund. Abu Dhabi investor Mubadala Development Co., the state-owned investor, and the Qatari government are also in talks to join.

Mubadala Development is already a major investor among the semiconductor industry. The company is the largest single shareholder in Advanced Micro Devices Inc. AMD, and also has ownership in Globalfoundries Inc., both major players in the semiconductors industry.

Vision Fund’s goal is to invest in high-growth tech start-ups and tech-related investments in public and private markets. With his $100 billion fund, Mr. Son met with President Trump in January about buying stakes in American tech companies. While it can create thousands of new jobs, it also means that many tech companies will be controlled by one entity.

Softbank closed Wednesday trading at $36.97 per share.

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