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Announcement Of $93 Billion In Committed Capital, And Launch Of Largest Tech Investment Fund Ever Made By Softbank And Saudis

Announcement Of $93 Billion In Committed Capital, And Launch Of Largest Tech Investment Fund Ever Made By Softbank And Saudis
Committed to what is expected to be the largest technology investment fund ever, closing $93 billion in capital was an investment group that includes Japan's SoftBank and Saudi Arabia’s sovereign wealth arm.
Investors in Softbank Vision Fund include the Mubadala Investment
Company of the United Arab Emirates, Apple, Foxconn technology Group, Qualcomm and Sharp, in addition to SoftBank and the Saudi kingdom's public investment fund, whose roles were previously announced.
The Vision Fund "will help build and grow businesses creating the foundational platforms of the next stage of the Information Revolution", said Softbank's CEO Masayoshi Son in a statement which hopes to close a total of $100 billion in committed capital by November.
An in-kind contribution from its stake in microprocessor company ARM Holdings will contribute to more than $8 billion of the $28 billion that Softbank is investing in the fund. The Vision Fund also will be a vehicle for oil-rich Saudi Arabia to diversify its investments but the amount of financial commitment from the Saudi fund was not disclosed.
According to a press release, ranging from ones focused on emerging technology to established, very large companies "requiring substantial growth funding," the Vision Fund intends to acquire both minority and majority stakes in both private and public companies.
"Technology has the potential to address the biggest challenges and risks facing humanity today. The businesses working to solve these problems will require patient long-term capital and visionary strategic investment partners with the resources to nurture their success," said Son, whose company is the world's single biggest tech investor.
The CEO has committed to investing $50 billion in the United States with the goal of creating 50,000 jobs, said President Donald Trump, after meeting with Son at Trump Tower in New York in December, shortly after his election. Dow Jones reported that the money would come from the Vision Fund although Trump claimed Son said that intended investment wouldn't have happened without Trump election.
"We are building a portfolio that is diversified across sectors, asset classes and geographies, and expect the Vision Fund to act as a platform to access a range of exciting, emerging opportunities in the technology sector," said Yasir Al Rumayyan, managing director of the Saudi public fund.
The investment will be a linchpin of Saudi Arabia's efforts to "develop a diversified, knowledge-based economy," he added.
The Saudi fund is effectively controlled by Mohammed bin Salman, the deputy crown prince of Saudi Arabia and the deal came together after what  reportedly were months of difficult negotiation between the tech company SoftBank and the Saudi fund.
Details of how Softbank had "haggled" with the Saudi fund had "over control of the money, investment strategy and questions about its commitment" was reported in the Wall Street Journal in an article last Friday.

Christopher J. Mitchell

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