SoftBank Group Corp. plans to invest as much as $25 billion in Saudi Arabia over the next three to four years as the Japanese company run by Masayoshi Son deepens investment ties with the kingdom, according to people familiar with the matter.
SoftBank aims to deploy up to $15 billion in a new city called Neom that Crown Prince Mohammed bin Salman plans to build on the Red Sea coast, the people said, asking not to be identified because the information is private. The Japanese company’s Vision Fund also plans investments of as much as $10 billion in state-controlled Saudi Electricity Co. as part of efforts to diversify the utility into renewables and solar energy, the people said. SoftBank also will have some of its portfolio companies open offices in Neom, they said.
The plans by SoftBank would bolster the crown prince as he cracks down on alleged corruption via a purge that has rattled investors. The infusion of cash also would aid the country as it seeks to diversify its economy away from oil. To put the magnitude of SoftBank’s plans into context, all foreign direct investment in Saudi Arabia totaled $7.45 billion last year, according to data from the Organization for Economic Cooperation and Development.
A representative for SoftBank declined to comment. A Saudi Electricity spokesman said the company didn’t have an immediate comment. SoftBank shares rose 1.6 percent in Tokyo trading.