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Equities

Takeover news sends SoftBank shares to 17-year high

Telecom giant jumps to fourth in TSE market cap ranking

Times are good for SoftBank CEO Masayoshi Son.

TOKYO/HONG KONG -- SoftBank Group shares hit a 17-year high on Friday after the Japanese telecom company announced it will buy two robot makers. The rise was helped by Chinese e-commerce giant Alibaba Group Holding and other companies in which SoftBank invests setting their own share price records the previous day.

SoftBank shares surged to 9,521 yen at one point, up 8% from the previous day, hitting their highest point since May 2000. This puts the company's value at about 10.4 trillion yen ($94.2 billion), pushing it to the fourth place among companies on the first section of the Tokyo Stock Exchange.

SoftBank has laid out a strategy of concentrating management resources in such areas as the internet of things, artificial intelligence and smart robots. The company announced it will acquire Schaft, a Japanese startup formed by the University of Tokyo, and U.S. startup Boston Dynamics. Both companies develop bipedal robots under the umbrella of Alphabet, Google's holding company.

Many market watchers welcomed the news, as the acquisition is in line with the company's long-term strategy, according to Masahiko Ishino, senior analyst at Tokai Tokyo Research Institute. The market is also excited because SoftBank's takeover strategy has previously borne fruit in the form of rising share prices of companies it has invested in.

Shares in Alibaba and American chipmaker Nvidia hit their all-time highs on Thursday in the U.S. SoftBank Chairman and CEO Masayoshi Son is known to have an eye for potentially high-growth companies, and expectations are growing that SoftBank's assets have even more unrealized profit in store.

The value of SoftBank's Alibaba stake jumped by about 1.38 trillion yen overnight after the Chinese company's stock price rose 13% on the day in New York on Thursday.

(NQN)

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