SoftBank has announced it will be retiring treasury shares worth 16.3% of its outstanding stock after a buy-back programme which has cost it $20 billion over the last year.
The cancellation will leave the Japanese investment conglomerate holding, as treasury stock, 0.6% of total shares issued. This follows the group's largest-ever buyback increased its holdings after it had been forced to step in to support its share price.
A treasury stock or reacquired stock is stock which is bought back by the issuing company, reducing the amount of outstanding stock on the open market.
The move is "probably not a signal either way on future buybacks," said analyst Kirk Boodry at Redex Research, adding it is in line with industry practice.
SoftBank's $100 billion Vision Fund – the world's largest technology-focused venture capital fund – is widely expected to post its largest-ever quarterly profit on May 12 with the listing of portfolio company Coupang Inc a contributory factor.
And the cancellation of the treasury shares will boost the ownership of its top shareholder, founder and chief executive Masayoshi Son, who holds a 25% stake.
The largest-ever gap between the value of SoftBank's assets and its share price last March led to debate over whether the group would go private before buybacks drove a recovery in the stock price.
- Reporting by Reuters