SoftBank to sell $7.9b stake in Alibaba
SoftBank said Tuesday that it will sell around $7.9 billion worth of shares in Alibaba to pay off debts.
Masayoshi Son, chairman of the Japanese telco giant, said in a statement that the two worked closely for the past 16 years and that there are "huge opportunities" ahead from the continual partnership.
The telco giant's stake in the Chinese tech giant will be reduced from 32 percent to 28 percent, making it still the majority shareholder.
SoftBank was one of the first investors on the then fledgling ecommerce giant Alibaba in 2000. It has paid back hugely with the initial investment of million of dollars now worth billions.
The Japanese firm needs to strengthen its balance sheet, partly due to the difficulty of Sprint, which it bought back in 2013. Since 2012, its net debt has near quadrupled. SoftBank is also reportedly considering selling Supercell, its Finnish game firm that developed the hugely popular Clash of Clans, to China's Tencent.
"As SoftBank looks to strengthen its own balance sheet, Alibaba determined that it was the best use of our capital to reinvest in our own business through an efficient buyback of a large number of shares in our own company that is accretive to our stockholders," Jack Ma, Alibaba's chairman, said in a separate statement.
The companies recently launched a joint venture cloud company in Japan, and will likely continue to leverage the partnership for profits.
Last year in June, the two firms collaborated in robotics, with Alibaba investing $118 million into SoftBank Robotics Holding.
SoftBank recently span out its global and domestic businesses.