Nikesh Arora, who was considered as a top contender to succeed SoftBank Group Corp. founder and CEO Masayoshi Son, will step down from his current post of President of the Japanese company.
Mr.Son made it clear that Mr.Arora won't get the top job in the near future. The development comes a day after a special committee, comprising independent members of the SoftBank Group board of directors, gave Mr.Arora a clean chit in an internal investigation for alleged irregularities in SoftBank's investments in Indian startups — Housing.com, a real-estate website and hotel-booking app Oyo Rooms.
Ex-Google executive Mr. Arora, 48, a former Google executive who made headlines as being one of the highest-paid company officials in the world, “will assume an advisory role,” from July, according to a company statement. He was under fire from shareholders over his compensation and they questioned some of his deals.
“I am indebted to him for his contributions,” Mr. Son said in a statement. “He will continue to be a friend of SoftBank, and I will have my hand on his shoulder.”
He said that Mr.Arora brought world-class execution skills to SoftBank, as evidenced by a myriad of investments made by the company over the last year. He said this included a complex monetisation of a stake in Chinese e-commerce giant Alibaba. In May, SoftBank said that it plans to sell at least $7.9 billion worth of its stake in Alibaba.
Mr.Son also credited Mr.Arora for playing a key role in helping SoftBank to sell its stake in gamemaker Supercell, for a total return of $ 7.3 billion. China’s largest internet company Tencent Holdings will lead an $8.6 billion acquisition of Supercell.
He said he had hoped to hand over the reins of SoftBank to Mr.Arora on his 60th birthday.
“But I feel my work is not done. I want to cement SoftBank 2.0, develop Sprint (a telecommunications firm) to its true potential and work on a few more crazy ideas,” he said.
Mr.Son said that this will require him to be CEO for at least another five to ten years and “this is not a time-frame for me to keep Nikesh (Arora) waiting for the top job.”
Mr.Arora, joined SoftBank from Google, where he was the chief business officer, in September 2014. He worked as president and chief operating officer at the company. During his tenure, SoftBank invested in a set of growth-stage companies in India such as Snapdeal, Ola, Oyo, Grofers and Housing.
“Helping Masa (Mr.Son) begin the transformation of SoftBank and sowing the early seeds has been a great experience,” said Mr.Arora in a statement.
Denies allegations However in April, a group of SoftBank investors sought a probe and possible sacking of the India-born Mr.Arora over potential conflicts of interest tied to his role as an adviser to a private equity firm. They wrote to the board and alleged past wrongdoing and generally poor business decisions. Mr.Arora denied allegations as baseless.
During Mr.Arora's tenure, SoftBank said it also extended its footprint in Asia successfully. It invested in mobile e-commerce company Coupang in Korea and the ride-share player Grab in Southeast Asia. SoftBank said it started building its portfolio in the US with investments like SoFi, a fintech company and Banjo, which utilises data analytics.
Among SoftBank's portfolio firms is Ola the ride-hailing company. Bhavish Aggarwal, Co-Founder and CEO, Ola said,“Nikesh (Arora) is a friend, guide and mentor to me personally. SoftBank as an investor, has played a key role in Ola's growth story.”
