Masayoshi Son’s empire wobbles as virus hits debt load
Japan Times -- Mar 23
Investors are growing increasingly skittish about the stability of Masayoshi Son’s empire.

Son’s SoftBank Group Corp., one of Japan’s most indebted companies, had been chipping away in recent years at concerns about its ability to carry that burden. As the founder remade the telecom company into a tech investor, analysts reassessed the debt in terms of the value of SoftBank’s shareholdings, a gauge that had made its balance sheet appear more manageable.

But the coronavirus pandemic is threatening to undo that progress as it pulls down equity markets and triggers the worst sell-off in credit markets since the 2008 financial crisis. It’s sparked a dramatic surge in the price of insuring against defaults around the world, including SoftBank’s. The company’s credit-default swaps have spiked to the highest in a decade.

“SoftBank has refinancing needs and constantly faces new fundraising needs, so it would be difficult to access funds if the current credit market turmoil continues,” said Hiroyuki Nishikawa, an analyst at S&P Global Ratings. The base scenario still remains that SoftBank has cash reserves to repay debt for the next two years, he added.

There has been no change in SoftBank’s financial policy of focusing on loan-to-value and having enough liquidity on hand to cover two years worth of bond repayments, the company said in an emailed statement. SoftBank said it is curbing new investments to match the current environment and acknowledged that fundraising costs are likely to rise going forward.

S&P cut its outlook on the group to negative late Tuesday, citing the broad market declines and the conglomerate’s plans for a share buyback.

Its market value of ¥6.78 trillion ($63.5 billion) is now less than that of SoftBank Corp., the domestic telecom operation that sold shares to the public last year. SoftBank Group still owns about two-thirds of the unit.

News source: Japan Times
Jan 26
Currently, anyone in Japan is free to dress as their favorite characters. But it might not stay free for them to do so. (kotaku.com)
Jan 26
Toyota Motor is on track to produce about 8.25 million vehicles worldwide for the year ending in March, largely sticking to its previous forecast even though a global semiconductor shortage has disrupted the auto industry in recent weeks, Nikkei learned Monday. (Nikkei)
Jan 25
Japan's major restaurant chains saw a record fall in sales last year due to the pandemic as people refrained from eating out and many businesses closed temporarily or shortened their opening hours. (NHK)
Jan 25
Japan's three major telecoms -- NTT Docomo, KDDI and SoftBank -- are gearing up for a rate war in spring. (Nikkei)
Jan 24
The Tokyo Stock Exchange says it will allow Toshiba to return to the First Section of traded shares, starting on Friday next week. (NHK)
Jan 24
Companies in Japan have not promoted teleworking much, despite a call by the government to reduce the number of workers in offices by 70% during the second coronavirus state of emergency, a survey by the Japan Productivity Center has shown. (Japan Times)
Jan 22
Japan's central bank will keep its key monetary policy unchanged. It's a signal that it has delivered sufficient stimulus for now to cushion the blow from the COVID-19 pandemic. (CNA)
Jan 21
Japan's exports were up in December from the same month the previous year on stronger demand from customers in China and other Asian countries. (NHK)
Jan 21
More than a dozen stores closed in Tokyo's high-end Ginza Six mall this week as the coronavirus pandemic kept big-spending foreign tourists and other luxury shoppers away from an upscale shopping district famous for brand-name boutiques. (Japan Today)
Jan 21
Japanese advertising giant Dentsu Group Inc. is considering selling its 48-story headquarters building in Tokyo for some 300 billion yen ($2.9 billion), which would make it the highest-priced building to be sold in Japan, sources close to the matter said Wednesday. (Kyodo)
Jan 20
Japan’s wholesale electricity prices hit the maximum possible for a third day after the government set upper limits on moves last week amid the worst power crunch since the Fukushima disaster nearly a decade ago. (Reuters)
Jan 20
One of Japan's top sporting venues is about to get a new owner. The Tokyo Dome, home ground of the Yomiuri Giants baseball team, will be part of real estate company Mitsui Fudosan's portfolio. (NHK)
Jan 20
Major Japanese retail chain Don Quijote opened its first Taiwan store on Tuesday, under the brand name Don Don Donki. (Formosa TV English News)
Jan 16
Japan's winter resorts are on a slippery financial slope as rising COVID-19 infections deter skiers and snowboarders. (Nikkei)
Jan 16
Japanese electronic parts manufacturers are making big investments to scale up output of components for electrified vehicles, seeking to establish a place in the coalescing supply chains for the rapidly growing field. (Nikkei)
Jan 16
The operator of a number of izakaya pub chains in Japan says it is closing down about 20 percent of its outlets in Tokyo. It hopes to mitigate the impact of shorter business hours due to the coronavirus pandemic. (NHK)
Jan 16
The Japanese government declared a second state of emergency following a surge in coronavirus cases in Tokyo and three neighboring prefectures on Jan 7. (Japan Today)
Jan 16
Rising coronavirus cases are leading Central Japan Railway to take the unprecedented step of requiring thousands of employees to go on paid leave as passenger numbers drop sharply. (NHK)
Jan 15
Toyota will pay $180 million to settle U.S. government allegations that it failed to report and fix pollution control defects in its vehicles for a decade. (Japan Todayj)
Jan 15
Japan’s wholesale prices fell 2.0% in December from a year earlier on sliding fuel costs, data showed on Thursday, a sign that the hit to demand from the coronavirus pandemic is weighing on the world’s third-largest economy. (Reuters)