The state of SoftBank’s finances has become a very touchy subject for the Japanese tech combo as it comes under increasing fire over its investment strategy and takes extraordinary measures to rein in debt.
It put out a two-page statement attacking the Moody’s credit rating agency on Wednesday for a downgrade that put it deeper into junk territory.
“While Moody’s continues to characterise SBG’s financial policy as aggressive, we believe that, even applying Moody’s stated rating criteria to the Program, there is no rationale for a two-notch downgrade to SBG’s ratings,” it said.
The downgrade came two days after SoftBank said it planned to sell $41bn of its assets to pay down its heavy debt load and to increase the scale of a share buyback. Those actions have triggered a 55 per cent jump in its share price, which fell to a four-year low last week as investors panicked over its hefty debt exposure. That stood at $170bn at the end of last year, so the $23bn just allotted by SoftBank for paying off debt will not make a big dent in that.
It’s this kind of irritating scrutiny by the likes of Moody’s that makes a founder like Masayoshi Son think about going private, which is exactly what happened last week, according to our FT scoop.
The Internet of (Four) Things
1. Amazon and Flipkart caught up in Indian freeze
India’s biggest ecommerce businesses Amazon and Walmart-owned Flipkart have been forced to suspend all services, amid confusion over whether their couriers are exempt from the strict 21-day coronavirus lockdown.
2. Broadband engineers lockdown
Frustrated broadband users in the UK looking to change internet provider may not be able to switch after BT said its Openreach engineers would prioritise essential fault repairs and upgrades to avoid unnecessary home visits. Broadband provider Virgin Media is hiring 500 call centre people in the UK to cope with customers looking to upgrade their broadband.
3. BBC suspends job cuts
The BBC has suspended a sweeping reform of its news operations to concentrate on its public broadcasting role during the coronavirus crisis, temporarily saving the jobs of hundreds of journalists. Director-general Tony Hall said the proposed £40m worth of cuts, which would lead to shows being taken off air and 450 job losses, was to be put on ice.
4. Tech predictions for a post-virus world
It is hard to imagine what the world will look like in a year’s time after just a few weeks of coronavirus-enforced quarantine. Will “stream shaming” become a popular pastime? Will iPod prices shoot up on eBay? Tim Bradshaw predicts what he might be reporting on a year from now.
Tech tools — Royole FlexPai 2
Chinese start-up Royole has been a pioneer in flexible and foldable screens in phones, beating Samsung and Huawei to the punch in 2018 with the first commercialised foldable phone, the Royole FlexPai (pictured above).
It has been slower out of the blocks with its follow-up, the FlexPai 2, finally unveiling some details of its forthcoming model in a Wednesday presentation. It comes with a large, 7.8-inch external ‘outie’ display with a 4:3 aspect ratio, reports Tech Radar. It will also feature a more robust hinge system. The launch is expected in the next three months, but no pricing is available yet