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SoftBank COO Marcelo Claure to leave as stock hits tough time

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SoftBank COO Marcelo Claure to leave as stock hits tough time

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SoftBank Group Corp.

9984 2.20%

said chief operating officer Marcelo Claure, who helped solve problems for the company’s investments, including WeWork Inc. and Sprint Corp., is leaving the company.

Mr Claure is the latest lieutenant of SoftBank founder and chief executive Masayoshi Son to leave the Tokyo-based investment firm, which manages the technology-focused Vision fund and owns a large stake in the Chinese e-commerce company. Alibaba Group Holding. ltd.

BABA -1.39%

SoftBank shares have fallen more than half since their peak last year, hurt by Alibaba’s troubles with Chinese regulators and, more recently, a sell-off in tech stocks spurred by the prospect of interest rate hikes in the United States. the departure following reports of tensions between him and Mr. Son sent the stock price up slightly.

In Tokyo on Friday, shares of SoftBank closed up 2.2% at 4,795 yen. That’s 55% below the peak reached in March 2021. SoftBank had owned almost a quarter of Alibaba since its last filing and it has been hurt by the Chinese company’s sharp drop in share price.

Other SoftBank executives who have departed include chief strategy officer Katsunori Sago, who resigned in March 2021. Meanwhile, longtime colleague Ronald Fisher left the company’s board. company in June.

SoftBank did not give a reason for Mr. Claure’s departure. Mr. Son issued a brief statement thanking Mr. Claure for his contributions and wishing him “continued success in his future endeavours.” Mr Claure described Mr Son as a “mentor and friend during my tenure”.

Masahiko Ishino, an analyst at the Tokai Tokyo Research Institute, said the unexplained split would likely reignite investor concerns over the succession plans of Mr. Son, who is 64 and founded SoftBank four decades ago.

SoftBank’s longstanding strategy of pouring mountains of money into promising young companies to create big winners has failed spectacularly at WeWork and invites scrutiny of the fund’s other investments. Here’s an overview of Vision Fund’s structure and how its fast-paced investment strategy could make it risky.

Mr Ishino said it was clear “who will be responsible for nuclear football when the US president can no longer function. If the same thing happens to SoftBank, we have no idea who will be in charge.

A SoftBank representative, asked for comment, referenced Mr. Son’s remarks at a June 2021 shareholder meeting. At the time, he said he was still thinking about succession and looking to form candidates inside and outside the company.

Mr Son also suggested at the meeting that he could stay in charge until he is 70 or 80 years old. He cited advances in medicine and the example of Warren Buffett, who remains chairman and CEO of Berkshire Hathaway. Inc.

at the age of 91.

The departure of Mr. Claure “means that Mr. Son becomes alone. While this likely won’t affect SoftBank’s operations, investors will likely worry that Mr. Son’s management might be slightly more dogmatic by having fewer advisers,” Mr. Ishino said.

Former Sprint chief executive Michel Combes will take over Mr. Claure’s role as chief executive of SoftBank Group International, which includes SoftBank’s investments in Latin America.

A 6ft 6in Bolivian, Mr Claure first met Mr Son in 2012, when Mr Claure was an entrepreneur running a company, Brightstar Corp., which distributed mobile phones and resold handsets used. SoftBank eventually bought Brightstar and put Mr. Claure in charge of Sprint, the money-losing U.S. cellphone provider.

Mr. Claure tried to overthrow Sprint while SoftBank continued its long-running and ultimately successful bid to merge Sprint with T-Mobile US Inc.

The outcome of Sprint’s stake included Mr. Claure’s personal investment in T-Mobile.

In May 2018, he became Chief Operating Officer of the SoftBank Group and the following year found himself tasked with dealing with another crisis. SoftBank held a majority stake in WeWork, the shared office company that nearly collapsed after a failed IPO attempt in 2019.

WeWork founder Adam Neumann, another Son protege, left and Mr. Claure took over as executive chairman. He guided the company to an IPO in October 2021.

According to a SoftBank Japan filing, Mr. Claure earned 1.795 billion yen, or $15.6 million, in the fiscal year ended March 31, 2021, an unusually high level for a Japanese company although he is not uncommon in the United States.

Mr. Son has a history of cultivating hard-working executives for high-level positions at SoftBank, only to part ways later. In 2014, he wooed Nikesh Arora of the company then known as Google Inc. and named Mr. Arora as his successor. Two years later, Mr. Arora was gone.

Write to Kosaku Narioka at kosaku.narioka@wsj.com and Megumi Fujikawa at megumi.fujikawa@wsj.com

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SoftBank COO Marcelo Claure to leave as stock hits tough time

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