Softbank-Saudi tech fund to make world’s largest investment in AI and robotics

TOKYO, Japan - Raising $93 billion of capital, the tech fund backed by Japan's Softbank Group and Saudi Arabia's main sovereign wealth fund became the world’s largest private equity fund.

Set to focus on investment in the technology sector, the areas of Artificial Intelligence and robotics will receive a bulk of the investments. 

Softbank Vision Fund said in a statement, "The next stage of the Information Revolution is under way, and building the businesses that will make this possible will require unprecedented large-scale, long-term investment.”

While Softbank is investing $28 billion, PIF has not revealed its commitment to the fund, although it said last year, that it would invest up to $45 billion over five years. 

The new fund would reportedly seek to buy minority and majority interests in both private and public companies, from emerging businesses to established, multi-billion-dollar firms. 

Further, reports noted that it expects to obtain preferred access to long-term investment opportunities worth $100 million or more.

The fund is also set to investment in other sectors including mobile computing, communications infrastructure, computational biology, consumer internet businesses and financial technology.

The statement added that the fund aims for $100 billion of committed capital and expects to complete its money-raising in six months.

Experts believe the fund will also help Riyadh obtain access to foreign technology as policymakers drive Saudi economy towards diversification into new industries as the Kingdom continues to suffer damages from low oil prices.

Revealing plans for the fund in October last year, Japanese billionaire Masayoshi Son, chairman of Softbank, Japanese telecom conglomerate has managed to gain massive commitments from some of the world's most prominent investors.

After the announcement, Saudi Arabia's Public Investment Fund (PIF) too had revealed its interest in the tech sector as it poured in $3.5 billion in investment in the U.S. ride-hailing firm Uber. 

Apart from Softbank and PIF, Abu Dhabi's Mubadala Investment has committed $15 billion, along with Apple Inc, Qualcomm, Taiwan's Foxconn Technology and Japan's Sharp Corp. making their own commitments to the fund. 

The announcement of the new fund was made during U.S. President Donald Trump’s first foreign visit since becoming President, in Riyadh, where Son too was present.

During his meeting with Trump soon after he was elected U.S. President last year, Son had famously pledged $50 billion of investment in the United States.

He further promised to create 50,000 jobs in the country.

Son now said in the statement, “SoftBank has long made bold investments in transformative technologies and supported disruptive entrepreneurs. The SoftBank Vision Fund is consistent with this strategy and will help build and grow businesses creating the foundational platforms of the next stage of the Information Revolution.”

Among the fund’s first investments are an acquisition of a 25 percent stake in SoftBank’s ARM Holdings Plc and its investment in satellite startup OneWeb Ltd.