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Masayoshi Son, Chairman and CEO of SoftBank, has hit back at some small investors in the company who alleged that the firm’s President and COO Nikesh Arora was involved in certain wrongdoings.
In a statement, Son said he has “thousand per cent” confidence in Arora. This came after an 11-page letter from a US-based law firm questioned the credibility of Arora.
Slamming the allegations, SoftBank said in a statement: “We can confirm we are in receipt of a letter from a US law firm claiming to represent unidentified shareholders. The letter makes unsubstantiated allegations against Arora.” It further added that the Board at the Japanese investment bank, which has investments in global e-commerce player Alibaba, “takes its duties seriously and is in the process of reviewing the letter. Arora remains a highly valued leader with proven investment abilities and we are confident he will continue to make great contributions at SoftBank in the years ahead.”
Arora, a former Google executive, joined SoftBank in 2014 as President and Chief Operating Officer at an annual package of $135 million, making him the world’s third-highest paid executive. He is even seen by many as Masayoshi Son’s heir apparent. Ever since Arora joined SoftBank, the firm’s focus has shifted largely to the Indian market and the investment firm has made several big ticket investments in start-ups, such as Snapdeal, Ola , OyoRooms and Housing.com. Son has made several visits to India and was a “star attraction” at Prime Minister Narendra Modi’s ‘Startup India Stand Up India’ event in January.
While SoftBank’s total investments in India have exceeded $10 billion, a few of them have gone “horribly” wrong, according to experts. For example, the company pumped in about $100 million in real-estate portal Housing.com, which has been struggling after the ouster of its founder Rahul Yadav. The company’s valuation fell from $250 million in November 2014, to $50 million in October 2015.
Arora, in a statement, said, “I take my fiduciary responsibilities seriously and have acted appropriately and in the best interests of shareholders throughout my tenure at SoftBank and Sprint, just as I have conducted myself throughout my professional life. I am completely confident the allegations in the letter are baseless.”
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