Softbank-Saudi tech fund becomes world’s biggest with $93bn of capital

A man looks at the logo of SoftBank Group Corp at the company's headquarters in Tokyo, in this file photo taken on June 30, 2016. (REUTERS)
Updated 21 May 2017

Softbank-Saudi tech fund becomes world’s biggest with $93bn of capital

RIYADH: The world’s largest private equity fund, backed by Japan’s Softbank Group and Saudi Arabia’s main sovereign wealth fund, said on Saturday it had raised over $93 billion to invest in technology sectors such as artificial intelligence (AI) and robotics.
“The next stage of the Information Revolution is under way and building the businesses that will make this possible will require unprecedented large-scale, long-term investment,” the Softbank Vision Fund said in a statement.
Japanese billionaire Masayoshi Son, chairman of Softbank, a telecommunications and tech investment group, revealed plans for the fund last October and since then it has obtained commitments from some of the world’s most deep-pocketed investors.
In addition to Softbank and Saudi Arabia’s Public Investment Fund (PIF), the new fund’s investors include Abu Dhabi’s Mubadala Investment, which has committed $15 billion, Apple Inc., Qualcomm, Taiwan’s Foxconn Technology and Japan’s Sharp Corp.
The new fund made its announcement during the visit of President Donald Trump to Riyadh and the signing of tens of billions of dollars worth of business deals between the US and Saudi companies. Son was also in Riyadh on Saturday.
After meeting with Trump last December, Son pledged $50 billion of investment in the US that would create 50,000 jobs, a promise Trump claimed was a direct result of his election win.
The fund may also serve the interests of Saudi Arabia by helping Riyadh obtain access to foreign technology. The PIF signaled an interest in the tech sector last year by investing $3.5 billion in US ride-hailing firm Uber. Saturday’s statement did not say how much the PIF had committed to the fund, but previously it has said it would invest up to $45 billion over five years. Softbank is investing $28 billion.
The new fund said it would seek to buy minority and majority interests in both private and public companies, from emerging businesses to established, multibillion-dollar firms. It expects to obtain preferred access to long-term investment opportunities worth $100 million or more.
Other sectors in which the fund may invest include mobile computing, communications infrastructure, computational biology, consumer Internet businesses and financial technology.
The fund aims for $100 billion of committed capital and expects to complete its money-raising in six months, it added.


New emissions blow for VW as German court backs damages claims

Updated 26 May 2020

New emissions blow for VW as German court backs damages claims

  • Scandal has already cost firm more than €30 billion; ruling serves as template for about 60,000 cases

KARLSRUHE, Germany: Volkswagen must pay compensation to owners of vehicles with rigged diesel engines in Germany, a court ruled on Monday, dealing a fresh blow to the automaker almost 5 years after its emissions scandal erupted.

The ruling by Germany’s highest court for civil disputes, which will allow owners to return vehicles for a partial refund of the purchase price, serves as a template for about 60,000 lawsuits that are still pending with lower German courts.

Volkswagen admitted in September 2015 to cheating in emissions tests on diesel engines, a scandal which has already cost it more than €30 billion ($33 billion) in regulatory fines and vehicle refits, mostly in the US.

US authorities banned the affected cars after the cheat software was discovered, triggering claims for compensation.

But in Europe vehicles remained on the roads, leading Volkswagen to argue compensation claims there were without merit. European authorities instead forced the company to update its engine control software and fined it for fraud and administrative lapses.

Volkswagen said on Monday it would work urgently with motorists on an agreement that would see them hold on to the vehicles for a one-off compensation payment.

It did not give an estimate of how much the ruling by the German federal court, the Bundesgerichtshof (BGH), might cost it.

Volkswagen shares were 0.5 percent lower. The BGH’s presiding judge had signaled earlier this month he saw grounds for compensation.

Costs mount

“The verdict by the BGH draws a final line. It creates clarity on the BGH’s views on the underlying questions in the diesel proceedings for most of the 60,000 cases still pending,” Volkswagen said.

A lower court in the city of Koblenz had previously ruled the owner of a VW Sharan minivan had suffered pre-meditated damage, entitling him to reimbursement minus a discount for the mileage the motorist had already
benefited from.

The court at the time said he should be awarded €25,600 for the used-car purchase he made for €31,500 in 2014.

“We have in principle confirmed the verdict from the Koblenz upper regional court,” said BGH presiding federal judge Stephan Seiters.

Volkswagen had petitioned for the ruling to be quashed altogether by the higher court, while the plaintiff had appealed to have the deduction removed.

A Volkswagen spokesman said that outside Germany, more than 100,000 claims for damages were still pending, of which 90,000 cases were in Britain.

The carmaker also said it had paid out a total of €750 million to more than 200,000 separate claimants in Germany who had opted against individual claims and instead joined a class action lawsuit brought by a German consumer group.

The carmaker said last month it would set aside a total of 830 million for that deal.

In a separate court, Volkswagen agreed last week to pay €9 million to end proceedings against its chairman and chief executive, who were accused of withholding market-moving information before the emissions scandal came to light.