“We estimate the Imaginative and prescient Fund to document $4.2 billion of unrealized losses this quarter primarily as a result of decline in Uber’s valuation,” Chris Lane, an analyst at brokerage agency Bernstein, wrote in a analysis observe final month.
Analysts polled by information supplier Refinitiv anticipate SoftBank to report complete working losses of 48.1 billion yen ($442 million) for the third quarter, in comparison with working income of 706 billion yen ($6.5 billion) for a similar interval a yr earlier.
Drawing a line underneath the WeWork fiasco
The bailout raised issues about how a lot religion — and cash — Son locations in charismatic founders like WeWork’s Adam Neumann. Neumann stepped down from the corporate’s board and left his position as CEO, after traders balked at WeWork’s lofty valuation and criticized the corporate’s governance.
SoftBank didn’t reply to a request for remark from CNN Enterprise about that report.
Brokerage agency Jefferies downgraded SoftBank from purchase to carry final month, and known as on the Japanese agency to make clear its funding technique.
The rescue of WeWork units a foul precedent of “throwing good cash after unhealthy,” Jefferies analyst Atul Goyal wrote. It “has proven us that zero shouldn’t be a valuation ground for any [SoftBank] asset holding,” he mentioned.
Earlier than the bailout, the Imaginative and prescient Fund and SoftBank had already invested practically $11 billion into WeWork. When SoftBank participated in a funding spherical again in January, the startup was valued at $47 billion.
SoftBank’s rescue bundle valued WeWork at about $eight billion — lower than half the overall sum of money SoftBank and the Imaginative and prescient Fund have poured into the corporate.