Japan’s Softbank Corp. and Korea’s Naray Mobile Telecom have signed
a deal to create an Internet venture capital firm for investment in
promising Korean Internet start-ups.
Softbank president and CEO Masayoshi Son and Naray chairman Lee Yong-Tae
signed an agreement to establish Softbank Holdings Korea (SBHK) with an
initial investment of about US$100 million. They said at a press conference
in Seoul early this week that about US$80 million would be used as a direct
investment fund by the new joint-venture to introduce foreign Internet
companies supported by Softbank into the Korean market.
The remaining US$20 million would be invested as seed money into Softbank
Ventures Korea (SBVK), which will be created to handle financial support to
local Internet start-ups.
Softbank will own a 80 percent stake in SBHK while Naray
Mobile Telecom will hold the remaining 20 percent share. The projected holding
company is expected to be established during the first half of next year,
according to company officials.
Son said that Softbank will invest in the Korean Internet industry by
acquiring 20-30 percent shares of each promising Internet firm selected by
Softbank, rather than buying them through mergers and acquisitions. The
Internet magnate also said that the initial investment will be US$100
million, adding that the input will increase to US$300-400 million.
“Softbank, which is now investing in 140 Internet related companies in the
U.S., plans to invest in a total of 780 companies around the world over the
next five years,” he said.
Under such an ambitious plan, Softbank will
select 100 venture firms each in Korea and China for investment, while
planning to double investment in Japan from the current 50 companies to 100
Internet-related firms are now struggling to attract funds from Softbank.
The firms believe that they will be able to advance into overseas markets
and upgrade their corporate value more quickly and more efficiently by
joining forces with Softbank.