© Reuters. SoftBank to Gain $34.1 billion From Alibaba (BABA) Stake Sale
By Sam Boughedda
SoftBank Group will make a $34.1 billion gain from reducing its stake in Alibaba (NYSE:), the company said Wednesday.
The move to cut its stake in the company comes as SoftBank looks to shore up its finances as economic instability continues. SoftBank has reduced its stake in the Chinese technology giant to 14.6% from 23.7% via the early settlement of prepaid forward contracts, which equates to a maximum of approximately 242 million American depositary shares or around 9% of Alibaba’s total outstanding shares.
Alibaba’s US-listed shares are up just over 1% late into Wednesday’s session.
In a filing, SoftBank said, through the sale, it “will be able to eliminate concerns about future cash outflows, and furthermore, reduce costs associated with these prepaid forward contracts.”
“These will further strengthen our defence against the severe market environment,” they added, as well as saying it would continue maintaining a good relationship with Alibaba.