Japan's SoftBank group has silently acquired a US $4 billion stake in US chipmaker NVIDIA, according to a report in Bloomberg. The holding comprises of 4.9 percent of the shares, which is just a shade below the threshold at which the acquisition is required to be disclosed according to US regulations. It is unknown at what time the stake in NVIDIA was acquired, and depending on the timing, SoftBank could have impressive gains in its returns.
NVIDIA has performed better than analyst expectations, and in 2016, posted its fastest growth in five years. The growth spurt was driven by chips for gaming and data centers. NVIDIA has a market value of more than US $80 Billion.
SoftBank with a group of partners has recently announced $93 Billion committed capital as part of it's Vision Fund. The investors in the fund include the Mubadala Investment Company of the United Arab Emirates, Apple, Foxconn, Sharp and others. The fund will allow SoftBank founder Masayoshi Son to invest more heavily in technology companies than what SoftBank could have invested on its own. The Vision Fund is expected to acquire SoftBank's stake in NVIDIA, according to a report in Nikkei Asian Review.
Initially, the plan was to have the Vision Fund acquire the stake in NVIDIA directly. However, the fund took longer to take off than expected. The Vision Fund is expected to acquire unspecified other investments by SoftBank as well. While NVIDIA chips have traditionally been used for graphics heavy computer games, now the vast processing potential is being increasingly used for autonomous vehicles technology. Automotive partners of NVIDIA include Toyota, Ford and Mercedez-Benz.
Published Date: May 25, 2017 11:25 am | Updated Date: May 25, 2017 11:25 am