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Is SoftBank spending wisely on Arora?

TOKYO -- SoftBank's revelation that it paid Nikesh Arora, its new president and chief operating officer, about 16.5 billion yen ($133.06 million) last fiscal year has raised eyebrows. Critics reckon the company is investing too much in one man. Others say the former Google executive is quickly proving his worth.     

SoftBank Chairman Masayoshi Son, left, sees President Nikesh Arora, as an ideal leader for the Japanese telecommunications and Internet company.   © Not selection

     The fat figure was included in the Japanese telecommunications and Internet company's securities report for the fiscal year ended March, submitted June 19. Arora only joined the company last September; he has been declared the "primary candidate" to succeed Chairman and CEO Masayoshi Son.

Fast climber

Arora, who was born in India, joined Google in 2004. This followed a stint at Deutsche Telekom in Bonn, Germany, where he was in charge of T-Mobile products and marketing.

     At the U.S. search company, he oversaw European operations and climbed the ladder to chief business officer -- a position responsible for all sales, marketing and partnerships. Prior to joining SoftBank, he was reportedly earning around $50 million in salary and stock.

     The numbers suggest he was worth it: During Arora's decade at Google, revenue grew from $2.5 billion to more than $60 billion, and the company surpassed U.S. rival Yahoo to dominate the search engine market. 

     Yahoo in 2012 brought in former Google Vice President Marissa Mayer to serve as CEO, in a bid to regain lost ground. There has been speculation that Arora was Yahoo's first choice.

     Arora first met Son about five years ago. Yahoo Japan, a SoftBank unit, was negotiating with Google about tapping the U.S. company's search technology; Arora was representing Google in the talks.

     Son's first impression was that Arora was a man of tremendous competence. In subsequent years, the two met frequently in Japan and the U.S., diving into discussions on a range of topics.

     When asked why he accepted Son's invitation to join SoftBank, Arora said he took the job because he was impressed by the chairman's way of doing business. "Masa is equivalent as a business innovator [to what Google executives] Larry [Page] and Sergey [Brin] are as technology innovators," Arora said. "And being a very strong student of business, I felt I could learn a lot more from a business side from Masa than I did from Larry and Sergey."

     While some might question Arora's pay package, he has wasted no time making his mark on SoftBank. 

     Tapping into his vast network of personal contacts, he has executed merger and acquisition deals estimated to be worth roughly 300 billion yen. The additions to SoftBank's portfolio include promising Internet companies in Asia.

Two of a kind?

One of Arora's best bargains was Snapdeal. Since SoftBank invested $627 million in the Indian e-commerce company last autumn, Snapdeal's corporate value has reportedly swelled from about $2 billion to $5 billion. The company's shares have been subject to 300% more trading volume.

     Son has shown his own knack for investment over the years.

     In 2000, when Son first met Alibaba Group founder Jack Ma Yun, he immediately decided to support him. "It was the look in his eye," Son said of the decision, likening it to an animal's instinct. Alibaba is now the biggest e-commerce operator in China; its debut on the New York Stock Exchange last September temporarily generated an unrealized gain of more than 10 trillion yen for SoftBank.

     If Arora helps SoftBank spot another Alibaba, his massive paycheck may prove to be money well spent. 

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