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SoftBank Group Corp's $525 Million Ai-Focused SPAC, SVF Investment Corp, Pricing 52.5 Million Units (Common Plus 1/5 Wt) At $10

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  • SVF Investment Corp priced 52.5 Million Units at $10 each consisting of one common share and 1/5 Warrant Exercisable at $11.50.
  • Sponsor, SoftBank Group Corp, may buy up to $300Million additional shares at consumption of merger.
  • Possible targets include SenseTime of Being China as well as Cruise Automation.
  • Shares could trade above $15 pre-LOI in the coming days/weeks.

SVF Investment Corp: Ticker: SVFAU

SoftBank Group Corp. Chairman and Chief Executive Officer Masayoshi Son stated, “Our SPAC will bridge SoftBank’s private and public investing strategies by enabling us to partner with a fast-growing, IPO-ready technology company. We believe that we have access to a wide range of compelling investment opportunities through our broad international presence and deep local networks,”.  

The SPAC, SVF Investment Corp, began trading as SVFAU last Friday.  See the SEC Document Filing here. See the Official Press Release here.

CFO and Director Navneet Govil, Managing Partner and CFO of SoftBank Investment Advisers stated, Our SPAC "plans to capitalize on the impacts of artificial intelligence and the global transition to the interconnection of everyday computing devices through the internet, with an intent to identify, acquire, and manage a business in a technology-enabled sector where management has differentiated experience and insights."

The Japanese investment giant is the "latest big name to jump on the wave of so-called blank-check companies."  

So you might ask, What are blank-check Companies?  Blank-check companies utilize an investment vehicle called a Special Purpose Acquisition Corp (SPAC) to enter the public markets, raising Millions and in some cases Billions of dollars and then use the money raised to merge with one or more private companies.  

Some of the largest companies to date include the likes of notorious head fund managers such as Bill Ackman who sponsored the Pershing Square Tontine  Holdings Ltd (PSTH) SPAC.  It has been rumored that he is looking at Stripe for a merger however I think he will end up summoning Rivian to the table. 

Other sponsor's in the SPAC space include several from the same sponsor, Social+ Capital's Chamath Palihapitiya.  This iconic investor who worked for Facebook and Slack and later formed Social Capital Hedosophia along with investor Ian Osborne.  With six SPAC's formed to date, Chamath has plans to form a SPAC for each letter in the alphabet each with an iconic ticker stating with IPO_.  Those currently seeking merger candidates to acquire are IPOD and IPOF , after IPOE announced plans to merge with SoFi last week on the CNBC Halftime Report.

So what's in the card for Softbanks new issue.  If the first day of trading is any indication I believe it will trade above $15 in the coming weeks and months as we await the potential merger partner to be announced.  It seems that the period of time from new issue to LOI is getting smaller and smaller to now sometimes even under 60 days.

The market reacted to the offering with a solid start to the day and held the $12.00 support into the close after opening at $12 and trading as high as $12.77 during the day and as low as $11.85.  In after hours movement the new blank check company closed at $12.63 on over 300,000 shares traded in the after hours session.

Management Team

Rajeev Misra

Rajeev Misra is the Chairman of the Board and Chief Executive Officer of the company. Mr. Misra serves as the CEO of SoftBank Investment Advisers, the investment manager to the SoftBank Vision Funds, Corporate Officer and Executive Vice President of SoftBank Group Corp. Previously he was a Senior Managing Director and Partner at Fortress Investment Group. Prior to that, he served as the Global Head of Fixed Income, Currencies and Commodities at UBS between 2009 and 2013 and Global Head of Credit and Emerging Markets at Deutsche Bank between 1997 and 2008, where he built a successful global fixed income business from scratch; recruiting and mentoring many employees.

Mr. Misra currently is a Board Member of Fortress Investment Group, the University of Pennsylvania and MIT Sloan School of Management, and is on the Board of Trustees of KAUST. He received a bachelor's degree in Mechanical Engineering and a master's degree in Computer Science from the University of Pennsylvania and an MBA from the MIT Sloan School of Management.

Navneet Govil

Navneet Govil is our Chief Financial Officer. Mr. Govil currently serves as a Managing Partner and Chief Financial Officer of SoftBank Investment Advisers (SBIA). Prior to joining SoftBank, Mr. Govil served in senior corporate officer roles for publicly traded multinational corporations. At CA Technologies, Mr. Govil was Senior Vice President of Finance and Strategic Pricing, where he led treasury, corporate business development, pricing and business unit finance functions. Previously, he was Vice President of Corporate Development and Project Finance as well as Treasurer at SunPower Corporation. Mr. Govil also served in several capacities during his eight-year tenure at Sun Microsystems, most recently as Controller for its Microelectronics Group. He also held finance positions at Hewlett-Packard, Pfizer and Fortistar Capital. Mr. Govil currently serves as a member of the Audit Committee for the board of directors of ARM Holdings and as board director of SBIA U.S. Mr. Govil earned MBA and MEng degrees from Cornell University.

Independent Directors

Ibrahim Ajami

Ibrahim Ajami is the Head of Ventures and Growth at Mubadala Investment Company and responsible for leading Mubadala’s ventures strategy and platform. He was previously the CEO of Advanced Technology Investment Company, a wholly owned subsidiary of Mubadala, responsible for overseeing the company’s interests in the advanced technology sector and led the development of Mubadala’s semiconductor strategy and investments. He joined Mubadala in 2006 and has been involved in the company’s growth over the past 15 years. He held various roles in Silicon Valley prior to joining Mubadala. Mr. Ajami has a bachelor’s degree from Northeastern University and an MBA from University of Southern California.

Dr. Anita Sands

Anita Sands is a Senior Partner at Sands Point Consulting LLC, which advises technology-based start-ups, CEOs and founders. Dr. Sands is currently a Board Member of ServiceNow, Pure Storage, Inc., iStar, and ThoughtWorks. In addition, Dr. Sands sat as a Board Member at Symantec Corporation (now, Norton Lifelock) between 2013 and 2019. She also served as Group Managing Director, Head of Change Leadership and a member of the Wealth Management Americas Executive Committee of UBS Financial Services, a global financial services firm. Dr. Sands holds a B.S. degree in Physics and Applied Mathematics from The Queen’s University of Belfast, Northern Ireland, a Ph.D. degree in Atomic and Molecular Physics from The Queen’s University of Belfast, Northern Ireland and an M.S. degree in Public Policy and Management from Carnegie Mellon University.

(All write-ups taken from SVF Investment Corp)

SoftBank Vision Fund's first SPAC being SVF Investment Corp. is by and far not their last one.  I envision SoftBank as being very influential in the coming months and many more SPAC's to be issued as they have an international connection many other sponsors do not have and have made investments to many technology start-ups who are now full-fledged unicorns and many more that are on their way to Unicorn status.  These investments have come via both SoftBank Vision Fund as well as SoftBank China Venture Capital.  Some of these firms included the likes of Cruise Automation and SenseTime.


Cruise Automation (S.F. Bay Area)

SenseTime (Beijing, China) 

Analyst's Disclosure: I am/we are long SVFAU IPOF IPOE IPOD PSTH.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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