U.S. hedge fund Tiger Global has built a stake worth over $1 billion in SoftBank Group Corp. as it considers the Japanese firm to be undervalued, a source with direct knowledge of the matter said, driving SoftBank shares up as much as 6.8 percent.
Tiger, which manages around $22 billion (about ¥2.46 trillion) in assets, told investors in a letter that SoftBank's stock price has not increased over the last five years even though its holding in Chinese e-commerce giant Alibaba has added more than $90 billion in value, the source said Wednesday.
The Japanese tech and telecommunications conglomerate, run by billionaire Masayoshi Son, has become deeply leveraged in its pursuit of winning investments. Besides Alibaba, it has stakes in U.S. telecom firm Sprint Corp. and Yahoo Japan Corp.