SoftBank’s Masayoshi Son’s Wealth Has Increased By $4 Billion

(CTN News) – SoftBank Group Corp’s share price surged this year, which boosted Son’s net worth by about $3.8 billion.

As measured by the Bloomberg Billionaires Index, the Japanese billionaire’s wealth increased at a rate of 30 percent a year. At the end of last year, SoftBank Group’s founder was worth $11.3 billion, compared with $15.1 billion on Tuesday.

Son benefits from Arm’s rally as he owns roughly a third of SoftBank Group, which holds 90 percent of the UK chip designer.Last week, Arm’s earnings report showed AI spending is boosting sales, extending its three-day rally to 90 percent.From its initial public offering price of $51, the stock has nearly tripled.

Shares of SoftBank are near a three-year high.

As long as its assets hold up their gains, people won’t say SoftBank is overpriced, says Masahiro Yamaguchi, senior market analyst at SMBC Trust Bank Ltd. Although Arm’s stock surge may appear overheated, if its earnings growth is solid in the future, it doesn’t seem out of character.

Last week, Arm gave a bullish forecast, suggesting it can expand beyond its traditional smartphone business into artificial intelligence. To gauge whether the latest gains have been excessive, Yamaguchi said investors are likely to look at Nvidia Corp.’s earnings next week.

According to Victor Galliano, an independent analyst who publishes on Smartkarma, Arm trades at a “super-premium” as Nvidia trades at only half the prospective earnings multiple for a very similar forward earnings-per-share growth. In addition, Kirk Boodry of Astris Advisory sees Arm’s multiples as “eye-wateringly high.”

The Vision Fund unit accounts for a significant portion of SoftBank’s total holdings, resulting in a significant discount to its net asset value. A post-pandemic slump has hurt tech valuations worldwide, resulting in losses for the second Vision Fund. Approximately 25.3 percent of NAV is accounted for by Vision Funds, while 48.4 percent is accounted for by Arm Funds.

Calculations based on company disclosures show Son is personally responsible for about $5.3 billion in side deals he set up at SoftBank Group to boost his compensation.

The Vision Fund 2 suffered losses of $2.9 billion and the Latin America Fund suffered losses of $556 million, according to December quarter disclosures. SB Northstar still had a deficit of ¥259.7 billion ($1.8 billion).

Soft-Bank’s Vision Fund 2 holds 17.25 percent of the billionaire’s unlisted holdings, as well as 17.25 percent of the company’s Latin America fund, which invests in startups. SB Northstar, the company’s stock and derivatives trading vehicle, has a 33 percent stake in him.

Vision Fund 2 accounts for about 14 percent of SoftBank’s equity value, and any markdowns would pose a risk, Galliano wrote in a Smart-karma note. It would require a radical change in the fortunes of SVF2 holdings for Masa’s IOUs with Softbank to be lowered, which seems unlikely, according to him.

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