SVB financial collapse sparks pundits’ fears of Softbank buyback, Alibaba flagging and Arm’s IPO rating cut

• SVB Financial Group (NASDAQ:SIVB) raised concerns among investors about exposure to startup companies Softbank Group Corp (OTC: SFTBF) (OTC: SFTBY) SoftBank Vision Fund.

• SoftBank shares plunged 13% to below 5,000 yen in four sessions, nearing levels some see as Son’s buyback threshold, Bloomberg reports.

• While SoftBank expects almost no repercussions from the US lender’s collapse, few investors believe the theory.

• “Financing conditions for start-ups became tougher and the window for IPOs tightened even before SVB failed,” said Tetsuro Ii, CEO of Commons Wealth Management Inc.

• SoftBank may need to downgrade the value of its invested private companies, particularly alibaba group holding ltd (NYSE: BABA), whose shares fell 30% from a January high.

• Softbank’s discount may not impress investors after losses that pushed SoftBank down 30% from a November peak.

• Amir Anvarzadeh, a strategist at Asymmetric Advisors Ptdnotes that the stock is approaching 4,800 yen, “with Son tending to hit the panic button and reveal more buybacks.”

• Shares are trading at a 38% discount to net asset value and Son could make a buyback if that increases to 50%, Oliver Matthew, an analyst at CLSA Securities Japan Cohe wrote in his Tuesday note.

• Accordingly Bloomberg Secret Servicethe recent rethinking of technology valuation could mean that the amount the company can raise when it goes public could fall arm ltd chip unit.

• SVB’s collapse “could also be the trigger that convinces SoftBank to raise money by selling Alibaba shares, as it puts itself in a position to protect some of its startups from any spillovers,” BI Analysts Note by Marvin Lo and Chris Muckensturm. “Such a move would likely diminish the prospects for a share buyback.”

• Photo via Wikimedia Commons

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