SoftBank gets Sharp commitment for Vision Fund

Electronics producer Sharp could provide up to $1bn for the Vision Fund being raised by Japan-based telecom and internet firm SoftBank, Reuters reported yesterday.

SoftBank (SBG) announced its intention to raise $100bn for the Vision Fund in October 2016, committing $25bn of its own money, with up to $45bn to come from the Saudi Arabian government’s Public Investment Fund.

Since then, consumer electronics provider Apple has committed $1bn for the fund, while mobile semiconductor maker Qualcomm and contract manufacturer Foxconn have both supplied capital.

Abu Dhabi sovereign investment fund Mubadala Development Co has reportedly been lined up for an investment of between $10bn and $15bn for the fund, and the state-owned Qatar Investment Authority and the family office of Oracle founder Larry Ellison have also signed up as partners.

Sharp said its reason for commiting $1bn was: “In the consolidated results of fiscal year ended March 31, 2017, Sharp’s operating income was positive for the first time in three years due to it returning to profitability in all of its business units.

“To transition toward a path of growth, Sharp is now looking at a variety of options. Among these, Sharp has identified IoT [internet of things] as a keyword for innovation that is advancing around the world and, in order to return to brilliance as New Sharp, has set a new direction to expand its businesses aggressively forward and transform itself into one of the world’s top IoT companies.

The [Vision] fund is expected to invest in IoT and other leading-edge technologies and Sharp expects the fund will forge new business sectors and give birth to a new paradigm shift with one of the world’s largest funds. Sharp decided to participate in the fund because, by participating in a fund of this kind, it expects to capture an opportunity to learn about the IoT space, which will in turn enable Sharp to accelerate its business expansion as an IoT company, which Sharp is aiming for.

“Furthermore, since SBG’s investment team, which has investment management capabilities in the technology sector as well as highly regarded wide-ranging operational knowledge and experience, will be making the investments, Sharp expects its participation in the fund to be conducive to improved financial performance.”

The only question would appear to be when SoftBank Vision Fund will reach its final close. SoftBank had initially said it planned to close the fund by the end of January but it has not added any information since.

Nevertheless, SoftBank has made a series of large investments, most recently paying $1.4bn for a 20% stake in India-based financial services and e-commerce company One97 Communications, and it is thought by many that these deals will end up being rolled into the fund.

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