Softbank Corp. sold 7.2 billion US dollars of Alibaba shares, which is about to be emptied.

Beijing, April 13 (Xinhua) Softbank Corp. Group has taken action to sell almost all its remaining shares in Alibaba Group in order to raise cash at a time when the value of its technology investment has been hit by the market downturn.

▲ Softbank Corp. founder Masayoshi son, according to a regulatory filing by the Securities and Exchange Commission, Softbank Corp. has sold about $7.2 billion (49.5 billion yuan) worth of Ali shares through a prepaid forward contract, which will eventually reduce Softbank Corp. 's stake in Ali to only 3.8%, down from 34% at its peak. Last year, Softbank Corp. sold a record $29 billion of Ali shares.

Softbank Corp. is increasingly using derivatives such as prepaid forward contracts to raise cash that can be paid immediately. These contracts do not amount to a formal sale of shares because they reserve the option to buy back shares in the future. However, Softbank Corp. had previously settled such contracts in advance, giving up the option to retain the shares. In February, Alibaba announced that Softbank Corp. 's stake in Ali had fallen below the 15 per cent threshold needed to nominate directors of the company, thus losing its seat on the board of directors.

Softbank Corp. declined to comment on the regulatory documents. But the company said the Alibaba deal reflected a shift to a "defensive model" to deal with a more uncertain business environment and that "we are strengthening our financial stability by raising funds to increase liquidity on hand". Softbank Corp. said that the additional funds raised from Ali shares will be disclosed when the fourth-quarter results are announced in May.

Affected by the news, Ali's shares fell nearly 3% in after-hours trading.