One of Rimac’s largest investors, Softbank, recorded a record loss of $39 billion

The Vision Funds of the Japanese investment company Softbank have reached record losses amounting to 5.3 trillion yen ($39 billion). This is one of the last major institutional investors in Rimac Group. The fund invested 500 million euros in Rimac Group at the beginning of last year, together with Goldman Sachs Asset Management.

During the last fiscal year, which ended in March, the Japanese company recorded a net loss of 970.1 billion yen, while the loss a year earlier was 1.7 trillion yen. In the first three months, the company’s fund losses amounted to 250 billion yen.

Softbank has now turned to a ‘defensive mode’, as the company’s founder Masayoshi Son called it, which means it is halting new investments and also reducing its stakes in companies.

Otherwise, Japanese Softbank has invested in startups through its three institutional players, Vision Fund 1, Vision Fund 2, and Latin America Funds, and it seems that the highest losses were incurred in the South American market and in the Vision Fund 2. This is the very fund that helped Rimac co-finance the construction of its campus.

Additionally, as reported by the Financial Times, it is close to an agreement to sell Fortress Investment Group, acquired in 2017, to the state-owned Mubadala Investment Fund from Abu Dhabi for as much as three billion dollars.

Although the values of some of their largest public investments, such as those in South Korean Coupang and Chinese Didi Global, recovered during the last quarter, analysts believe that losses in the private portfolio were greater than expected.

Kirk Boodry, an analyst at Astris Advisory in Japan, told the Financial Times that Softbank’s conservative stance is likely to continue due to prolonged market uncertainty following the collapse of Silicon Valley Bank, as well as the ongoing battle against inflation.

– The environment is definitely tough as interest rates have risen and we actually do not see an end to the rate hikes. It will be difficult for Softbank as they borrow a lot of money – said Boodry.

The Japanese group has sold shares of Alibaba worth about $7.2 billion through pre-paid futures contracts, which will reduce Softbank’s stake in the Chinese company to just 3.8 percent.