Softbank in talks to buy stake in Swiss Re

Gladys Abbott
February 11, 2018

The reinsurer gained as much as 6.8 percent in Zurich on Thursday, the highest intraday rise since November 2011, and was trading 4.2 percent higher at 11:29 a.m. local time.

The news follows SoftBank's announcement on Wednesday that it was preparing to list its domestic telecoms unit, raising further funds that could be used to shore up its finances or make more investments.

"A major shareholder is like a quality stamp for the company", the person said.

SoftBank past year raised more than $93 billion to create the Vision Fund, the world's largest private equity fund, and by the end of December had invested $27.5 billion in 20 tech firms through its investment arm.

Another route for SoftBank to take a stake in Swiss Re would be for the Swiss company to sell some of the 23 million treasury shares it holds. By contrast, its near 30 percent stake in Alibaba is worth around $130 billion.

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"Reinsurance, especially through a high-class outfit like Swiss Re, is attractive for several reasons", David Havens, an analyst at Imperial Capital, said in a note to clients. It is yet unknown whether SoftBank Group itself or the investment fund will buy the Swiss Re stake. SoftBank stock closed up 1 percent.

Following the report, Swiss Re issued a statement the same day saying the discussions are at a "very early stage, adding: "There is no certainty that any transaction will be agreed, nor as to the terms, timing, or form of any transaction".

SoftBank founder Masayoshi Son has said he wants to build a group of industry-leading companies that, powered by technological advancements in artificial intelligence and interconnected devices, will endure for 300 years.

Softbank is supposed to be more a tech visionary business and not a conglomerate.

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