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SoftBank

SoftBank to raise up to $604m for acquisition vehicle

Conglomerate aims to use Nasdaq-listed SPAC to list companies quickly

SoftBank is looking to take advantage of a surge in public markets this year. (Photo by Manami Yamada) 

TOKYO -- SoftBank Group on Monday filed in the U.S. to raise up to $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 $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 $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 $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 $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 U.S. 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 U.S. filing. The filing did not rule out the possibility of buying a company that is affiliated with SoftBank.

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