Nikesh Arora, who was tipped for the top job at Japan's SoftBank, has resigned abruptly, leaving questions about what prompted his decision as well as the future of the big-spending conglomerate's plans for India.
Arora, 48, who is the president of SoftBank Group Corporation, has sold the stake he bought last year for $483 million to Chief Executive Officer Masayoshi Son at a “small loss“ and he did not disclose his next moves. “Helping Masa begin the transformation of SoftBank and sowing the early seeds has been a great experience,“ Arora said in a statement.
Son, 58, who chose Arora as his heir and saw in him the same risk-taking ability that he possessed but was rare in tradition bound Japan, heaped encomiums on the former Google executive. In a statement, he praised Arora's “unparalleled skills around strategy and execution“, and took responsibility for changing his mind about handing over the reins to Arora when he turned 60 in August 2017. A statement from the Japanese company acknowledged that this played a role in Arora's departure. “The difference of expected timelines between the two leads to Arora's resignation from the position of representative director and director of SBG with the expiration of the term of office and his next steps.“ Son, however, was enigmatic about what led to the reversal in his position. “I feel my work is not done. I want to cement SoftBank 2.0, develop Sprint (the US telecom company majority-owned by SoftBank) to its true potential and work on a few more crazy ideas. This will require me to be CEO for at least another five to ten years. This is not a time frame for me to keep Nikesh waiting for the top job,“ a statement quoted Son as saying.
Later, in a series of tweets, Arora said, “Masa 2 continue 2 be CEO for 5-10 years, respect that.Learnt a lot. Clean chit from board after thorough review. Time for me to move on (sic).“
In another tweet, Arora said he didn't want to be CEO-in-waiting “past my sell by date“. He did not comment on his next move.
Arora, a former chief business officer at Google, is part of a crop of Indian-origin executives occupying corner-room jobs in the world's biggest corporations. Some, such as Google's Sundar Pichai, Microsoft's Satya Nadella and Pepsi's Indra Nooyi, have gone the full distance but in recent months there have been some high-profile stumbles. Anshu Jain, a friend of Arora, resigned as co-CEO last year from Germany's Deutsche Bank after being perceived as a shoo-in for the top job. And now Arora too has stepped down. “Nikesh was the rock star of India's startup ecosystem. He changed the landscape by taking big bets,“ said Vijay Shekhar Sharma, the founder of Paytm, a mobile marketplace and payments company which is backed by China's Alibaba, in which SoftBank is an investor. “India's late-stage investments won't be the same again.“
Just on Monday , Arora was exonerated by an internal panel of SoftBank which was inquiring into allegations of conflict of interest made by an anonymous group of shareholders in the conglome rate, which has interests in telecommunications, media and Internet firms. According to SoftBank, his decision to leave is not connected with the inquiry.
Arora, one of the world's highest paid executives with a $73-million package last fiscal, will move to an advisory role and his severance package will be in “accordance with global standards“.
His exit is being watched closely in India, where Arora led SoftBank's investment of a total of over $1 billion in companies including online retailer Snapdeal, ride-hailing app Ola, budget hotel aggregator Oyo, on-demand grocery delivery firm Grofers and realty portal Housing. SoftBank has cut large cheques for stakes of over 30%, quickly establishing itself as a significant player in India's startup sector. It has promised to invest $10 billion in technology companies and a further $20 billion in solar energy projects. Although Son did not comment on India in particular, investors and entrepreneurs believe that SoftBank will continue to stay committed to India although there may be some short-term distraction.
Kunal Bahl, the founder of Snapdeal, described Arora as a “great supporter and mentor“ to his company and said he expects business as usual. “SoftBank will continue to provide financial and strategic support to our company and the transition will have no impact on our business,“ he said.
Arora's decision to quit, said to be a “joint one“, came barely 24 hours after a special committee comprising independent board members gave him a clean chit related to allegations of questionable transactions, poor investment performance and conflict of interest.The charges were made by a group of anonymous investors through a New York-based law firm. Arora's pay package, and his anointment as successor to Son, also resulted in grumblings in the senior ranks of SoftBank.
Arora, 48, who is the president of SoftBank Group Corporation, has sold the stake he bought last year for $483 million to Chief Executive Officer Masayoshi Son at a “small loss“ and he did not disclose his next moves. “Helping Masa begin the transformation of SoftBank and sowing the early seeds has been a great experience,“ Arora said in a statement.
Son, 58, who chose Arora as his heir and saw in him the same risk-taking ability that he possessed but was rare in tradition bound Japan, heaped encomiums on the former Google executive. In a statement, he praised Arora's “unparalleled skills around strategy and execution“, and took responsibility for changing his mind about handing over the reins to Arora when he turned 60 in August 2017. A statement from the Japanese company acknowledged that this played a role in Arora's departure. “The difference of expected timelines between the two leads to Arora's resignation from the position of representative director and director of SBG with the expiration of the term of office and his next steps.“ Son, however, was enigmatic about what led to the reversal in his position. “I feel my work is not done. I want to cement SoftBank 2.0, develop Sprint (the US telecom company majority-owned by SoftBank) to its true potential and work on a few more crazy ideas. This will require me to be CEO for at least another five to ten years. This is not a time frame for me to keep Nikesh waiting for the top job,“ a statement quoted Son as saying.
Later, in a series of tweets, Arora said, “Masa 2 continue 2 be CEO for 5-10 years, respect that.Learnt a lot. Clean chit from board after thorough review. Time for me to move on (sic).“
In another tweet, Arora said he didn't want to be CEO-in-waiting “past my sell by date“. He did not comment on his next move.
Arora, a former chief business officer at Google, is part of a crop of Indian-origin executives occupying corner-room jobs in the world's biggest corporations. Some, such as Google's Sundar Pichai, Microsoft's Satya Nadella and Pepsi's Indra Nooyi, have gone the full distance but in recent months there have been some high-profile stumbles. Anshu Jain, a friend of Arora, resigned as co-CEO last year from Germany's Deutsche Bank after being perceived as a shoo-in for the top job. And now Arora too has stepped down. “Nikesh was the rock star of India's startup ecosystem. He changed the landscape by taking big bets,“ said Vijay Shekhar Sharma, the founder of Paytm, a mobile marketplace and payments company which is backed by China's Alibaba, in which SoftBank is an investor. “India's late-stage investments won't be the same again.“
Just on Monday , Arora was exonerated by an internal panel of SoftBank which was inquiring into allegations of conflict of interest made by an anonymous group of shareholders in the conglome rate, which has interests in telecommunications, media and Internet firms. According to SoftBank, his decision to leave is not connected with the inquiry.
Arora, one of the world's highest paid executives with a $73-million package last fiscal, will move to an advisory role and his severance package will be in “accordance with global standards“.
His exit is being watched closely in India, where Arora led SoftBank's investment of a total of over $1 billion in companies including online retailer Snapdeal, ride-hailing app Ola, budget hotel aggregator Oyo, on-demand grocery delivery firm Grofers and realty portal Housing. SoftBank has cut large cheques for stakes of over 30%, quickly establishing itself as a significant player in India's startup sector. It has promised to invest $10 billion in technology companies and a further $20 billion in solar energy projects. Although Son did not comment on India in particular, investors and entrepreneurs believe that SoftBank will continue to stay committed to India although there may be some short-term distraction.
Kunal Bahl, the founder of Snapdeal, described Arora as a “great supporter and mentor“ to his company and said he expects business as usual. “SoftBank will continue to provide financial and strategic support to our company and the transition will have no impact on our business,“ he said.
Arora's decision to quit, said to be a “joint one“, came barely 24 hours after a special committee comprising independent board members gave him a clean chit related to allegations of questionable transactions, poor investment performance and conflict of interest.The charges were made by a group of anonymous investors through a New York-based law firm. Arora's pay package, and his anointment as successor to Son, also resulted in grumblings in the senior ranks of SoftBank.
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