Here comes the Son

Mr Son’s whims are not a surprise in Japan, where the corporate world has grown accustomed to his ways. He has long been known as a maverick, the only Japanese business leader to invite comparisons with Bill Gates of Microsoft or the late Steve Jobs of Apple. Yet the bets on Sprint and, now, on Mr Arora are as sizeable and risky as any he has made. That worries investors, who tend not to be keen on a 300-year business plan that means expensive investments in the short term, but whose returns may not come in their lifetimes.

They are also said to be concerned about the sums Mr Arora will be paid in the future. As a result, SoftBank’s shares trade at a hefty discount to book value. According to Atul Goyal of Jefferies, an investment bank, given SoftBank’s stake in Alibaba, which is worth more than ¥6 trillion, and its investments in Yahoo Japan, Sprint and other firms, the current market capitalisation of SoftBank, at ¥8.2 trillion, implies that its entire, profitable Japanese telecoms business is worth nothing.

Origen: The Economist