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On June 9th, it was reported that on June 7th, Xu Shubiao, General Manager of State Power Investment Corporation (SPIC), met with Liang Huiling, Deputy Secretary of the Heilongjiang Provincial Party Committee and Governor of Heilongjiang Province, in Harbin to exchange views on deepening cooperation in the energy sector and jointly promoting the revitalization and development of Heilongjiang. Since the beginning of this year, SPIC has held working talks with Inner Mongolia, Qinghai, Henan, Hainan, Gansu, Jilin, Fangchenggang City of Guangxi Zhuang Autonomous Region, Xilingol League of Inner Mongolia Autonomous Region, Zhanjiang City of Guangdong Province, and the Hengqin-Macau Greater Bay Area in Guangdong Province, exchanging views on jointly planning key cooperation projects during the 15th Five-Year Plan period. Heilongjiang Province is willing to work with SPIC to deepen cooperation between the central and local governments and achieve win-win development in serving national strategies. This includes planning and constructing heavy-duty gas turbine projects, deeply participating in Heilongjiangs electricity-computer synergy pilot project and zero-carbon industrial park construction, and actively developing biomass straw and livestock manure resource utilization projects.According to the General Administration of Customs, Chinas crude oil imports in May 2026 totaled 33.081 million tons, compared to 38.471 million tons in April. From January to May 2026, Chinas crude oil imports totaled 218.364 million tons, compared to 229.457 million tons in the same period of 2025.According to the General Administration of Customs, Chinas refined oil exports in May 2026 reached 3.368 million tons, compared to 3.119 million tons in April. From January to May 2026, Chinas refined oil exports totaled 19.233 million tons, compared to 21.843 million tons in the same period of 2025.June 9th - According to customs data, in the first five months of the year, my countrys total trade with ASEAN reached 3.52 trillion yuan, a 16.6% increase; trade with the EU reached 2.53 trillion yuan, a 10.3% increase; and trade with the US reached 1.61 trillion yuan, a 6.6% decrease. During the same period, my countrys total imports and exports with countries participating in the Belt and Road Initiative reached 10.57 trillion yuan, a 13.6% increase.June 9th - A COVID-19 report released by the Democratic Republic of Congos (DRC) Ministry of Health on June 8th showed that the overall Ebola outbreak in the country continues to rise. As of June 7th, the cumulative number of confirmed cases in this outbreak had risen to 550, with 101 deaths. The report also indicated that the total number of recovered cases in the DRC has increased to 19. The report stated that while the recent number of newly reported cases has slightly decreased, this may be related to lag in updating testing data and does not yet indicate that the spread of the epidemic has weakened.

How will SoftBank decrease its Alibaba stake without selling shares?

Aria Thomas

Aug 11, 2022 10:56

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By reducing its investment in Alibaba Group Holding from 23.7% to 14.2%, SoftBank Group Corp hopes to gain $34.1 billion.


However, the Japanese titan would not instantly sell its shares on the market. It utilizes "prepaid forward contracts," a complex derivative extensively employed by investors.


How these agreements function:

WHAT ARE FUTURE-PAYMENT CONTRACTS?

A prepaid forward contract is a type of derivative contract that enables investors to hedge equity investment risk.

HOW DOES IT WORKS?

The contract contains a floor price and a ceiling price, limiting the exposure of investors to the set price range.


Investors can either pay financial institutions in cash or physically deliver the shares to complete transactions.


"The investor is safeguarded against loss if the price of the shares falls below the floor. Alternately, if the company's growth exceeds the cap, the investor is not entitled to any of the upside." This was claimed by David Martinez, an associate at the legal firm Clifford Chance.

Exist other advantages to prepaid forward contracts?

According to Gareth Old, a partner at Clifford Chance, investors who wish to monetize holdings without selling the stocks utilize prepaid forward contracts often. Financial institutions advance the funds using the range's floor price and a discount rate.


Moreover, with prepaid forward contracts, investors only pay taxes on capital gains when the contract is finalized.

WHY HAS SOFTBANK DECIDED TO PREPAY THE CONTRACTS BY DELIVERING ALIBABA'S SHARES?

Due to the challenging market conditions, SoftBank has decided to transfer 242 million Alibaba shares to financial institutions instead of selling them directly.


SoftBank also indicated that the physical settlement will alleviate concerns over future cash outflows, reduce contract-related fees, and bolster its defenses against the market decline.


The Japanese company anticipates earning $34 billion in unrealized profits and settlement proceeds.


Bo Pei, senior equity research analyst at U.S. Tiger Securities, stated, "It is evident that they want cash." "The IT industry as a whole has decreased by 30% to 40%. SoftBank has always made substantial investments in these industries, but they now demand finance."

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