Credit Market Takes SoftBank’s 25% Arm Stake Purchase in Stride

The cost to insure SoftBank’s debt against default was indicated 5.5 basis points lower at 225 basis points, according to a trader Tuesday. If it holds, the move would mark the biggest decline in a week, according to CMA data. The Japanese tech conglomerate’s credit default swaps dropped to a two—year low of about 200 basis points on July 31.

The CDS move suggests investors are more focused on the overall positive impact that Arm’s planned initial public offering, which is set to be the biggest in the US this year, will have on SoftBank’s finances. The UK chip designer’s stock listing is expected to increase the liquidity of SoftBank’s investment portfolio and allow the parent firm to more easily monetize its stake in the future.

“Overall, the Arm IPO is credit positive as it could raise funds” and improve the portion of listed shares in SoftBank’s portfolio, said Bloomberg Intelligence credit analyst Sharon Chen. Chen said her view on the stake purchase itself is negative as the “deal uses up the expected proceeds from the IPO, which reduces the amount available for debt repayment.”

Arm revealed in its IPO filing that SoftBank will remain its controlling shareholder after it begins trading, with SoftBank’s acquisition of the 25% stake from Son’s Vision Fund. SoftBank has been boosting its cash pile over the past two years by selling down its shareholding in one-time crown jewel Alibaba Group Holding Ltd., after rising interest rates hurt its investments in startups. The group had a cash position of 5.8 trillion yen at the end of June, compared with 2.1 trillion yen two years earlier.

Indonesia Berita Terbaru, Indonesia Berita utama

Similar News:Anda juga dapat membaca berita serupa dengan ini yang kami kumpulkan dari sumber berita lain.

Arm Listing Set to Be Turning Point for IPO Market, SoftBankArm Ltd. is expected to unveil its filing for an initial public offering as soon as Monday, giving the market a peek at the chip designer’s financial health seven years after it was acquired by SoftBank Group Corp.
Sumber: BNNBloomberg - 🏆 83. / 50 Baca lebih lajut »

London Stock Market Revival Falls Flat as Arm Flees for IPO to New YorkThe world’s biggest listing this year may be that of a British firm, but in Arm Ltd.’s home market there’s much lament over its decision to sell shares in New York over London.
Sumber: BNNBloomberg - 🏆 83. / 50 Baca lebih lajut »

Rouble falls past 94 to dollar as market takes a breather after volatile weekAug 21 (Reuters) - The rouble weakened past 94 to the dollar on Monday but traded relatively steady after one of its most volatile weeks all year, when an unscheduled rate hike to 12% and support from exporters' foreign currency sales sparked a recovery from beyond the 100 mark.
Sumber: KitcoNewsNOW - 🏆 13. / 78 Baca lebih lajut »

Half of Hong Kong Stocks Are Oversold as Bear Market Takes HoldAbout half of the stocks in Hong Kong’s benchmark index are now oversold as investor sentiment deteriorates amid China’s dismal economic data, deflation fears, and a property market slump that’s now threatening a crisis in the shadow lending sector.
Sumber: BNNBloomberg - 🏆 83. / 50 Baca lebih lajut »