Son Jeong-ui, chairman of Japan’s Softbank, borrowed $92 million (about 121.5 billion won) from a bank with his U.S. mansion as collateral due to WeWork’s failed investment and the creation of a Vision Fund fund, a report showed. According to the Financial Times (FT), Son obtained such a loan from Mizuho, a Japanese bank, in December 2019 with his mansion in Woodside, California as collateral. It is estimated that money was needed at the time when WeWork’s initial public offering (IPO) failed and he was trying to raise billions of dollars for a second Vision Fund. Son bought the Woodside mansion 117.5 million dollars from Tully Friedman, co-founder of private equity fund Hellman & Friedman, at the time. The price of Son’s mansion was six times the price of the house calculated for property tax assessment. It was bought at a high price, but after that, the value of the mansion fell further, real estate site Redfin estimated the mansion to be worth $23 million, and a local real estate agent said it would be between $75 million and $90 million. In recent years, Son has been raising cash using assets held by his investment firm, SoftBank, as collateral, from his stake in Arm, a British chip design firm, to his stake in Alibaba. Then, he began taking out personal loans from SoftBank to cover investment costs in the second Vision Fund, Latin America Fund and SB Northstar, a short-term hedge fund affiliate. By the end of September last year, his personal debt to SoftBank had exceeded $5 billion, the FT said.
SALLY LEE
ASIA JOURNAL
