On Monday SoftBank Group Corp stated, it will repurchase up to $1.9 billion (200 billion yen) of its domestic unsecured corporate bonds, from June 30 to July 17, as part of a plan to pare down its debt.
SoftBank’s CEO Masayoshi Son is undertaking an asset monetisation programme to raise $41 billion to fund the company’s share buyback program and reduce its debt. The development comes in the wake of a series of tech investments which have soured as a result of which the group reported a record annual loss.
SoftBank also said, it expects to record a gain of around $5.6 billion (600 billion yen) in the April-June quarter stemming partyly from the sale of its stake in T-Mobile U.S. as well as the revaluation of the shares it still holds.
A derivative liability from call options received by the wireless carrier’s top shareholder Deutsche Telekom is not included in that figure.
SoftBank’s leveraged balance sheet has given it an oversized presence in Japan’s junk bond market, supported by a loyal retail investor base for a household name that also owns Japan’s third largest wireless carrier.
The humongous asset sale plan has caused concern among credit-rating firms and with Moody’s revising its outlook last week reignited its spat with SoftBank, which in March asked for its rating to be withdrawn.