By Echo Wang
Feb 27 (Reuters) – A group of global investors including Qatar Holdings, an investment arm of Qatar Investment Authority, Visa and Abu Dhabi Investment Authority, is preparing to invest more than $200 million as cornerstone investors in the U.S. initial public offering by SoftBank’s PayPay, according to two people familiar with the matter.
PayPay, a Japanese digital payments provider, is targeting a valuation of up to $14 billion in the offering, one of the people said, in what could be the biggest listing for a Japanese company on a U.S. stock exchange.
The source declined to be identified as the information had not been publicly disclosed. The sources cautioned that no final commitment has been made, and the size, terms of the potential cornerstone investments and the valuation of the deal are being discussed and could change.
PayPay plans to list on the Nasdaq next month, one of the people said, adding SoftBank hopes that bringing cornerstone investors on board will boost the IPO’s appeal. The IPO was initially expected in December, but was delayed by a prolonged U.S. government shutdown that slowed the regulatory process.
PayPay, SoftBank, Qatar Holdings, Visa and ADIA did not immediately respond to requests for comment.
Reuters first reported over two years ago that SoftBank was considering a U.S. listing for PayPay.
SOFTBANK GENERATING FUNDS FOR AI SPENDING
The planned IPO of PayPay comes at a pivotal moment for SoftBank Group, which has gone all-in on artificial intelligence. The Japanese conglomerate has committed $30 billion to OpenAI, building on a roughly $41 billion investment it said it completed in December for an estimated 11% stake, Reuters reported. To help fund its AI investments, CEO Masayoshi Son has sold billions of dollars’ worth of assets, including the company’s $5.8 billion stake in Nvidia and $4.8 billion of T-Mobile U.S. shares. The PayPay listing – the first U.S. listing for a SoftBank-majority business since Arm Holdings – could provide a timely cash boost for the conglomerate.
Earlier this month, PayPay said it had entered a partnership with Visa, as the Japanese payments company seeks to expand into the U.S.
Jointly formed by SoftBank and Yahoo Japan in 2018, PayPay has helped accelerate Japan’s digital transformation, encouraging consumers to move away from cash by offering rebates on payments through its mobile app. Just over seven years since its founding, PayPay has rapidly expanded and grown into one of Japan’s most widely used payment platforms, amassing roughly 72 million registered users as of December 31.
(Reporting by Echo Wang in New YorkEditing by Rod Nickel)
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