SoftBank and Saudis launch largest tech investment fund ever, announce $93 billion in committed capital

Key Points
  • The launch comes five months after SoftBank's CEO reportedly told Donald Trump he would invest $50 billion in the United States
  • The Vision Fund represents a move by oil-rich Saudi Arabia to diversify investments
  • Other investors include the Mubadala Investment Co. of the United Arab Emirates, Apple, Foxconnn, Qualcomm and Sharp.
Softbank CEO Masayoshi Son speaks to the press after meeting with U.S. President-elect Donald Trump at Trump Tower in Manhattan, New York City, U.S., December 6, 2016.
Brendan McDermid | Reuters

An investment group that includes Japan's SoftBank and Saudi Arabia's sovereign wealth arm announced on Saturday it had closed $93 billion in capital, committed to what is expected to be the largest technology investment fund ever.

In addition to SoftBank and the Saudi kingdom's public investment fund, whose roles were previously announced, investors in Softbank Vision Fund include the Mubadala Investment
Company of the United Arab Emirates, Apple, Foxconn Technology Group, Qualcomm and Sharp.

In a statement, Softbank's CEO Masayoshi Son said the Vision Fund — which hopes to close a total of $100 billion in committed capital by November — "will help build and grow businesses creating the foundational platforms of the next stage of the Information Revolution."

Softbank is investing $28 billion in the fund, more than $8 billion of which will come from an in-kind contribution from its stake in microprocessor company ARM Holdings. The amount of financial commitment from the Saudi fund was not disclosed, but the Vision Fund also will be a vehicle for oil-rich Saudi Arabia to diversify its investments.

The Vision Fund intends to acquire both minority and majority stakes in both private and public companies, ranging from ones focused on emerging technology to established, very large companies "requiring substantial growth funding," according to a press release.

Son, whose company is the world's single biggest tech investor, said, "Technology has the potential to address the biggest challenges and risks facing humanity today. The businesses working to solve these problems will require patient long-term capital and visionary strategic investment partners with the resources to nurture their success."

Shortly after his election, President Donald Trump, after meeting with Son at Trump Tower in New York in December, said the CEO had committed to investing $50 billion in the United States with the goal of creating 50,000 jobs. Although Trump claimed Son said that intended investment wouldn't have happened without Trump election, Dow Jones reported that the money would come from the Vision Fund.

Yasir Al Rumayyan, managing director of the Saudi public fund said: "We are building a portfolio that is diversified across sectors, asset classes and geographies, and expect the Vision Fund to act as a platform to access a range of exciting, emerging opportunities in the technology sector."

He added that the investment will be a linchpin of Saudi Arabia's efforts to "develop a diversified, knowledge-based economy."

The deal came together after what reportedly were months of difficult negotiation between the tech company SoftBank and the Saudi fund, which is controlled by Mohammed bin Salman, the deputy crown prince of Saudi Arabia.

The Wall Street Journal in an article Friday detailed how Softbank had "haggled" with the Saudi fund had "over control of the money, investment strategy and questions about its commitment."