SoftBank Group on Monday filed in the US to raise up to USD 604 million for a special purpose acquisition company, marking the conglomerate’s latest attempt to ride a boom in public markets this year.
SVF Investment Corp., as the vehicle is called, is sponsored by SoftBank Investment Advisors, the SoftBank unit that manages its nearly USD 100 billion Vision Fund. It will be headed by Vision Fund CEO Rajeev Misra and intends to “promptly” list on the Nasdaq exchange.
It is offering 52.5 million units for USD 10 a piece, with an over allotment option for a further 7.9 million units.
Managing a SPAC — a shell company that merges with an operating company, allowing the latter to go public without going through the traditional IPO process — will enable SoftBank to back a company that wants to quickly list its shares.
The first Vision Fund was designed to invest large amounts of capital in late-stage unicorns — companies worth USD 1 billion or more — but that strategy suffered a setback when WeWork, one of its high-profile investments, failed to go public last year.
This year, the Vision Fund’s strategy has shifted toward smaller investments in early-stage companies. But early-stage investments generally take longer to exit. A SPAC can back a company that is still in its growth phase but eager to take advantage of a strong public market.
The SPAC may also act as a gauge of investor confidence in SoftBank after it scaled back plans to raise USD 108 billion for a second Vision Fund earlier this year.
The original fund’s performance was hit by a selloff in stocks in March, but recovered sharply in the second half of the year. It was boosted by a large paper gain on its investment in US food delivery startup DoorDash, which recently went public.
SVF Investment aims to use the SPAC to buy a tech company “where our management team have differentiated experience and insights” according to the US filing. The filing did not rule out the possibility of buying a company that is affiliated with SoftBank.