SoftBank sells to Cerberus; conversion to an ordinary bank and relisting (2003)

A bank held as an investment redraws itself with each owner

Sumitomo Mitsui Banking Corporation put its hand up, and the seller decided on terms anyway. SoftBank’s position was consistent: the Aozora shares were something to be “sold at the time of listing for a profit,” and with its own bond redemptions running at over ¥40 billion a year there was no reason not to pick the higher bidder. Who owns a bank was settled here, it seems fair to say, less by the design of financial policy than by the seller’s cash position.

Nor were the buyer’s ten years spent growing a bank. Cerberus did force through the conversion to an ordinary bank and the relisting, but the shares closed their first day at ¥502 against an offer price of ¥570, the loan book remained 26.9% weighted to the property sector, and in 2013 the fund exited its stake for around ¥150 billion. That outside capital can push a change of business model through quickly is one thing; that the change takes root is another. A bank held as a pure investment, it could be said, had its outline redrawn each time the shareholder changed.