Japan’s SoftBank Group Corp has devalued by as much as $22 billion, on the back of a global tech stock tumble, and ongoing outrage over Saudi Arabia’s alleged slaying of a prominent journalist in Turkey.
SoftBank shares fell 7.3% to 9,251 yen ($82.80) at close in Tokyo today, marking the nadir of a nightmare fortnight for the company, whose aggressive investment in tech heavyweights like Uber and Didi Chuxing has raised eyebrows worldwide.
SoftBank’s troubles have been deepened by the global anger at Saudi Arabia, the biggest investor in its $100bn Vision Fund, the biggest of its kind, after a team of Saudi nationals is alleged to have murdered journalist Jamal Khashoggi inside its Istanbul consulate on October 2.
Companies and media organizations including JP Morgan Chase and the Financial Times have already pulled out of a forthcoming summit in Saudi capital Riyadh, and the White House has announced it is considering punitive action against the Kingdom, which has denied claims of Khashoggi’s death.
“Although we don’t expect this latest diplomatic incident to lead to any sanctions on Saudi, there is always some possibility that some firms will pull out their money from the Vision Fund,” wrote Amir Anvarzadeh, a Singapore-based market analyst, adding that the tech stock drop poses a longer term problem for SoftBank.
Khashoggi, a US resident and regular Washington Post contributor, was a critic of Mohammed Bin Salman, the crown prince of Saudi Arabia who took control of his country last year. SoftBank CEO Masayoshi Son had cleaved an increasingly close relationship with “MBS”, who committed $45bn to Son’s ambitious Vision Fund. Son has yet to comment on the scandal in Istanbul.