The Associated Press
Softbank Corp. on Monday approved a plan to sell its stake in Aozora Bank to Cerberus, a U.S. investment fund, for 101 billion yen.
The deal still needs approval from Japan’s financial authorities.
Softbank said the sale was expected by the end of August.
Softbank has been looking to unload its 49 percent stake in Aozora so it can concentrate on a fledging broadband service that has already attracted major corporations as competitors.
The plan to sell the stake to Cerberus, which already owns a 12 percent stake in Aozora, received official approval at a meeting of Softbank executives, the company said in a statement.
Softbank has invested in a number of Internet ventures, including Yahoo Japan Corp. It bought its stake in Aozora from the central government in 2000. The bank, previously known as Nippon Credit Bank, had been nationalized after collapsing in 1998.
At the time of purchase, Softbank was banking on financial services as a key part of its strategy to develop online services such as electronic shopping.
The company, however, has since embarked on an aggressive broadband strategy, and Softbank President Masayoshi Son says the service, called Yahoo! BB, needs capital as it builds its subscriber base.
Softbank lost 99.99 billion yen in the year to March 31, the second straight year of losses, largely because of huge outlays for Yahoo! BB. Sales meanwhile inched up 0.5 percent to 406.9 billion yen.
The sale to Cerberus is highly controversial. Earlier media reports have said financial authorities had been hopeful a Japanese bank would purchase Softbank’s Aozora shares. But almost all of Japan’s banks are struggling to boost profits, maintain capital and wipe out the bad loans racked up over the long slowdown.
Shinsei Bank, which was reborn after it collapsed, is owned by Ripplewood, another U.S. investment fund.
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