Softbank raises eyebrows with talks to buy a slice of Swiss Re

Ivan Schwartz
February 11, 2018

"Swiss Re informs that it is engaged in preliminary discussions with SoftBank Group Corp, ("SoftBank") regarding a potential minority investment in Swiss Re", the press release states.

The talks still could fall apart and there might not be a deal, the newspaper said.

The Zurich-based company declined to comment further.

After this news, shares of Swiss Re has humped more than 9 percent in midday training. A spokesman for SoftBank didn't immediately respond to requests for comment.

SoftBank shares climbed 1 percent on Thursday, in line with the broader market.

SoftBank, which has raised $93 billion of its planned $100 billion Vision Fund, has taken stakes in businesses including ride-hailing, chipmaking, office-sharing, satellite-building, robot-making, even indoor kale-farming.

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Following the report, Swiss Re issued a statement the same day saying the discussions are at a "very early stage, adding: "There is no certainty that any transaction will be agreed, nor as to the terms, timing, or form of any transaction".

SoftBank could also be aiming to secure another source of cash flow to fund further spending. Buffett has used the "float" - or premiums held by such businesses before paying claims - to fuel his stock picks and acquisitions at Berkshire Hathaway Inc.

The Japanese firm's interest-bearing debt at the end of December was 15.8 trillion yen ($144.5 billion), with Son saying on Wednesday he wants to keep debt levels below 3.5 times earnings before interest, taxes, debt and amortization.

"SBG is now accelerating its global investment activities through the SoftBank Vision Fund and other vehicles to drive overall growth for the SoftBank Group", said the Japanese firm.

Join us at Intelligent Automation in Insurance - London 2018. Softbank is reported to be looking for a stake of less than 33% in Swiss Re.

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