Masayoshi Son Now Owes SoftBank $4.7 Billion on Side Deals

(Bloomberg) — Masayoshi Son is now personally worth nearly $4.7 billion in side deals involving SoftBank Group Corp. closed to increasing his compensation after mounting losses in the company’s technology portfolio wiped out the value of his interest in the company. Second Vision Fund.

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Over the years, the Japanese billionaire’s controversial personal stake in SoftBank has drawn fire from investors who have pointed to the conflation of personal and company interests as a concern of corporate governance. Son, who owns more than 30% of SoftBank’s shares, denied a conflict of interest, saying it was a reward for his investment expertise rather than an investment fee.

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The move backfired, putting Son’s personal finances at odds with the world’s biggest tech investor. Bloomberg News previously reported that the boy lost more than $4 billion in its trading side in the June quarter.

Son said last week that he was giving up leading earnings calls to prepare for chip designer Arm Ltd. to file for a public listing — an event that would give SoftBank fuel to reinvest. SoftBank is taking its time in the tech winter and paying down its debt, he said.

The 65-year-old founding director owns 17.25% of a vehicle set up as part of SoftBank’s Vision 2 Fund for unpopular stocks, as well as 17.25% of its Latin American fund unit, which also invests in startups. He owns a 33% stake in SB Northstar, a vehicle set up by the company to trade stocks and derivatives.

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Son’s interests in the Vision 2 Fund and the Latham fund are structured so that the billionaire has not paid cash for his 17.25% stake. The son is liable to pay 3% on the “unpaid share acquisition amount” until the interest is paid back on his liabilities.

After adjusting for losses from his interests in Vision Fund 2 and the Latam fund, Son’s net worth was $12.7 billion after Thursday’s close, according to Bloomberg Billionaires Index estimates.

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SoftBank’s Vision Fund unit posted a quarterly loss of $7.2 billion last week, which was driven by a decline in the value of portfolio companies such as SenseTime Group Inc., DoorDash Inc. and based GoTo Group. The company sold off assets in an effort to raise cash and strengthen its balance sheet, benefiting from the sale of a portion of its stake in Alibaba Group Holding Ltd.

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