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Summary
- SoftBank Group has filed an application to launch a blank check company, a special purpose acquisition company.
- With the issuance of securities by SoftBank Vision Fund Investment Corp, the entity is expecting to raise $525 million.
SoftBank Group Corporation has recently filed an application to float a blank check company with which it is expecting to raise an amount equivalent to $525 million. The fundraising via the blank check company may rise to $603 million if the underwriters’ over-allotment option is exercised in full, the company said. SoftBank Vision Fund Investment Corp has appointed Deutsche Bank Securities, Citigroup, and Cantor as the underwriters to the IPO.
Blank check company
The planned blank check company has been incorporated as a Cayman Islands exempted enterprise for fulfilling a set purpose. As per the prospectus filed, the blank check company will enable share exchange, share purchase, effecting a merger, reorganisation or combination of businesses of similar with one or more enterprises and asset acquisition.
The issue
SoftBank Group has launched SoftBank Vision Fund with a purpose to invest in businesses leading the artificial intelligence revolution. A Class A ordinary share and one-fourth of a redeemable warrant collectively constitute a unit of the company that is priced at $10.
The special purpose acquisition company is required to complete one or more business combinations to comply with the Nasdaq rules. The aggregate fair market value of the business combinations should be at least 80 per cent of the assets held in the trusts account at the time of signing a “definitive agreement” with regard to the initial business combination.
According to SoftBank, the special purposes acquisition company will enable the entity to associate with IPO-ready technology and fast-growing companies bridging SoftBank’s private and public investing strategies. The units of the SoftBank-floated SPAC are likely to see a Nasdaq listing under the proposed ticket SVFAU. The Class A ordinary shares of the unit will be listed under SVFA.
SoftBank’s backing
SoftBank Investment Advisers backed SoftBank Vision Fund Investment Corp is likely to invest in the newly framed company. The challenges due to the Covid-19 pandemic have dramatically accelerated the adoption of digital services. In line with the transformation, SoftBank Group has made it to an investment firm from the status of an operating company.
With the deep-rooted local networks and the broad global presence, the company will have access to a wide range of investment opportunities.
Proceeds of the issue
According to the prospectus, a definitive chunk of the net proceeds will be held in the trust account, which may be used as consideration to pay the sellers of a target business with that the company ultimately completes its initial business combination. The company has not borrowed any amount through the promissory note channel from the sponsor as on the date of the prospectus.
SoftBank’s global strength
SoftBank Investment Advisers was initially established by the SoftBank Group Corp to manage the SoftBank Vision Funds. On a global scale, SBIA has evaluated more than 3,000 potential investment opportunities as of 30 September and has provided operational, strategic, and financial advice alongside deploying $85 billion in the form of long-term private capital.
