SoftBank Group announced that it is increasing its stake in Yahoo Japan through a $2 billion, three-way deal with U.S. firm Altaba — ahead of an IPO of its telecoms unit.
SoftBank will buy 221 billion yen or $2 billion of Yahoo Japan shares from Altaba (earlier known as Yahoo Inc.). Yahoo Japan will then buy back 220 billion of stock from SoftBank, Reuters reported.
SoftBank said its stake in Yahoo Japan will increase to 48.17 percent from 42.95 percent with $9 million net investment. Altaba, Yahoo Japan’s second largest shareholder, will have about 27 percent and end a joint venture partnership.
SoftBank said the deal will strengthen cooperation between the company, one of Japan’s big three telecoms firms, and Yahoo Japan, an internet heavyweight in areas such as news and shopping.
“The synergies between SoftBank and Yahoo Japan are consistent with SoftBank Group’s broader strategic synergy group initiative,” SoftBank CEO Masayoshi Son said in the statement.
SoftBank and its Vision Fund, the world’s largest private equity fund standing at over $93 billion as of May last year, have been taking minority stakes in technology companies around the world that Son believes will come to dominate their respective fields.
SoftBank is preparing to list its domestic telecoms unit.
Yahoo Japan could use SoftBank’s telecom services to boost demand for online shopping and mobile payments in Japan. SoftBank, through Yahoo Japan and others, is offering its mobile users top-up services in addition to a basic phone subscription.