Saudi Arabia and Japanese SoftBank Group is said to set up an investment fund for technology based companies. If the fund which is expected to be about 100 billion dollars, actually becomes that large will be one of the biggest private equity funds in the world, and a force to be reckoned even within VC communities.
The news comes on the heels of an oil-rich middle east, and especially a Saudi Arabia shaken by the drastic fall in oil prices. Investing in other areas besides oil will be crucial to the economic outlook of the state. For example, earlier this year Uber received an investment of 3.5 billion dollars from Saudi Arabia’s sovereign wealth fund.
Then you have SoftBank. The telecommunications and tech corporation has gained quite the reputation for funding emerging industries. It’s already one of the largest investors in India and its Indian startup investments is expected to exceed 10 billion dollars. It also made headlines in July as it made Japan’s largest overseas business deal when the decision to buy UK chip design company Arm Holdings.
From the Saudi end, Public Investment Fund (PIF), is expected to be the top investor with a contribution of about $45 billion over the coming five years. SoftBank will invest a minimum $25 billion.
In addition, other affluent investors are interested in participating and could raise the corpus value up to $100 billion, SoftBank Chairman Masayoshi Son said in a statement.
"Over the next decade, the SoftBank Vision Fund will be the biggest investor in the technology sector,"
The fund will be headed for SoftBank by Rajeev Misra, the group's strategic finance head while PIF will be headed by its own director.
BW Reporters
Regina is a reporter for BW Businessworld. In her previous assignments, she has worked with Independent television Network as a news anchor and reporter in Sri Lanka
