SoftBank’s Vision Fund plans to borrow $4 billion

SoftBank’s Vision Fund plans to borrow $4 billion against its stakes in Uber and two other Silicon Valley groups, as the investment arm of the Japanese conglomerate looks to hand back cash to investors in its $100 billion fund. The fund is in discussions with banks, including Goldman Sachs, to arrange a loan secured against its holdings in Uber, which listed this month, and Guardant Health as well as its stake in soon-to-be-floated Slack… If the value of those stakes falls beyond a certain threshold, the fund will be obliged to stump up more cash… Since the inception of the Saudi Arabia and Abu Dhabi-backed fund in 2016, attention has focused on the dozens of investments made by SoftBank founder Masayoshi Son and the fund’s chief executive, Rajeev Misra, a former Deutsche Bank debt trader. These deals have largely taken place in private markets, but the wave of technology stock market listings over the past few months has created the potential for the Vision Fund to cash out from some of its investments. By borrowing against the value of publicly traded shares, SoftBank can return capital to its investors in the fund while bypassing “lock-up” periods that prevent shareholders from selling stakes in newly-listed businesses. Goldman is among the banks in talks to provide the loan, which carries an interest rate of 150 basis points over Libor… 
Robert Smith, Arash Massoudi and Laura Noonan