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The picture of corporate Japan painted by tech companies this week is one of governance issues, manufacturing challenges, a need to reinvent . . . and some pretty smart investment decisions.
Panasonic’s strategy is a shift to software and subscription services, helped by its $7.1bn purchase of Blue Yonder of the US. “As everything becomes digital, it’s becoming increasingly difficult to differentiate through hardware,” Yasuyuki Higuchi, a Panasonic executive, explained in an interview.
A filing on Friday showed Panasonic had sold its entire stake by the end of March in longstanding battery partner Tesla. It raked in about ¥400bn ($3.6bn) as it sought to raise cash to finance its biggest-ever overseas acquisition.
The Japanese conglomerate acquired 1.4m Tesla shares at $21.15 each in 2010 for about $30m. As Lex points out, the Tesla stake was valued at $730m in its annual report for the year to March 2020, but shares rose more than fivefold the following fiscal year. Cleverly, cashing in its Tesla stake to help it buy Blue Yonder is helping it to diversify away from batteries at a time when carmakers are looking to take their production in-house.
SoftBank’s chief Masayoshi Son faced investors this week at its annual meeting, after the conglomerate had recorded the highest-ever annual net profit for a Japanese business, with its $100bn Vision Fund boosted by the listings of portfolio companies including Coupang and DoorDash. But governance issues were more on shareholders’ minds, with Son having to insist SoftBank was not a “one-man show” and reveal succession planning.
Last, but certainly not least, Toshiba shareholders have ousted the chair of the company’s board in a historic vote that tipped one of the country’s most celebrated corporate names into uncharted territory and marked a watershed for investor activism in Japan.
Friday’s decision to vote against the reappointment of Osamu Nagayama as chair at the annual meeting was described by some of Toshiba’s largest investors as an inevitable consequence of the company’s long failure to establish better governance.
The Internet of (Five) Things
1. Didi seeks $4bn from US listing
Didi Chuxing, the Chinese ride-hailing company, laid out plans to raise as much as $4bn from an initial public offering on the New York Stock Exchange, in what would be one of the largest international listings in years. The Beijing-based company said it would offer 288m American Depositary Shares at a price range of $13 -$14, according to an updated prospectus.
2. Virgin Galactic cleared for lift-off
The billionaire’s space race between Jeff Bezos and Richard Branson entered the final stage on Friday, as Branson’s Virgin Galactic finally won the go-ahead from US regulators to put paying passengers into the lower reaches of space. The approval from the Federal Aviation Authority sent Galactic’s shares up by 37 per cent in morning trading in New York.
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3. A16z raises big crypto fund
Andreessen Horowitz, the venture capital firm that has backed Facebook and crypto exchange Coinbase, raised $2.2bn for its third fund focused on digital assets, more than doubling its initial target in a sign of strong demand from institutional investors. The Silicon Valley group will set up a third fund focused on finding “the next generation of visionary crypto founders”, it said. Its latest fund will dwarf its previous two funds, of $350m and $515m. Meanwhile, human society, the historian Niall Ferguson says, oscillates between the dynamic of a metaphorical “tower” and the “square”. This matters if you want to make sense of the $1.5tn crypto world and this week’s wild price swings, writes Gillian Tett.
4. Spacs and meme stocks get recognition
Dozens of companies that entered US markets through deals with blank-cheque vehicles in the past year are set to graduate into the Russell 3000 index on Friday evening. But short seller Jim Chanos has told the FT the Spac boom is building “castles in the sky”. Elsewhere, hedge funds are stepping up efforts to spot the next GameStop, after this year’s “meme stock” bonanza left the industry nursing billions of dollars of losses.
5. CMA probes Amazon and Google fake reviews
The UK competition regulator has opened an investigation into Amazon and Google over fake reviews on their sites. The Competition and Markets Authority said the two may not have done enough to detect and remove fake reviews or to take action against those responsible for them. In other news, Amazon has bought Wickr, the encrypted messaging app founded in 2012, for an undisclosed sum.
Tech tools — All things electric
Thanks to advances in motors and battery tech, electrically powered vehicles are gaining a new generation of fans, writes Fergus Scholes for How To Spend It. Add miniaturisation into this gear change in innovation, and a whole new genre aimed at leisure and personal mobility is springing up that until recently would have been unthinkable. He looks at a range of mobility options, including the Mate Icon e-bike, the Onewheel Pint Board (pictured), the Seabob F5 SR Sled and Polaris Ranger EV Vehicle.