SoftBank scrapped a proposed $100 million investment in former Android chief Andy Rubin’s start-up Essential Products, partly due to the Japanese company’s relationship with Apple, The Wall Street Journal (WSJ) reported.
According to the report, SoftBank’s investment in the start-up hardware company had been informally agreed and final contracts were in the process of being drawn up. In addition to the cash injection, SoftBank’s Japanese subsidiary was set to provide marketing support for Essential Product’s high-end handset launch, which was pencilled in for spring 2017.
Sources close to the deal said although Apple didn’t block the Essential Products move, the increasingly close relationship between Softbank and Apple would “complicate” an agreement between the Japanese company and a rival handset manufacturer.
Rubin’s Essential Products assembled a team of 40 including former employees of Apple and Google to create a range of consumer products. A high-end smartphone with edge-to-edge screen and a port used to connect a range of accessories, including a 360-degree camera, was tipped to be in the cards.
Investment and acquisition
Softbank has been aggressive in its acquisition and investment strategy in recent months, with the company paying £24 billion for UK-based chip company ARM in 2016 and spending $3.3 billion on US investment firm Fortress Investment Group in February. Yesterday, Bloomberg reported the company had invested $300 million in US shared office company WeWork.
SoftBank CEO Masayoshi Son is also in the process of setting up a $100 billion SoftBank Vision Fund in partnership with the Saudi Arabia Public Investment Fund, which will be used to invest in a range of technology companies spanning start-ups through to established names. Included in the list of potential investors are Apple, which has reportedly committed to a $1 billion investment.