DigitalBridge Group Inc. (DBRG) had itself a Monday. Shares of the digital infrastructure-focused private equity firm jumped after reports emerged that SoftBank Group Corp. (SFTBF) is in advanced discussions to acquire the company. We're talking 30% gains in premarket trading, with the stock hitting a fresh 52-week high at $18.20.
According to Bloomberg, SoftBank could announce a deal as soon as Monday, though no final agreement has been reached. The usual caveats apply: timing and structure could still change, terms remain undisclosed, and nothing's done until it's done. But the market clearly likes what it's hearing.
DigitalBridge wasn't exactly struggling before this news hit. The company entered the session already up more than 23% year-to-date, sporting a market valuation of approximately $2.5 billion. Interestingly, the rally comes despite some earlier skepticism. Back in July, Jim Cramer told viewers of CNBC's "Mad Money Lightning Round" that he didn't recommend the shares, citing valuation concerns. Looks like the market had other ideas.
Masayoshi Son's Infrastructure Play Gets More Aggressive
For anyone following SoftBank founder Masayoshi Son's recent moves, this acquisition makes perfect sense. Son has been on an aggressive tear into digital infrastructure, betting big on the computing power needed to fuel artificial intelligence growth. The DigitalBridge talks fit neatly into that strategy.
Consider the context: In January, SoftBank announced the $500 billion Stargate data center initiative alongside OpenAI, Oracle Corp. (ORCL), and Abu Dhabi-backed MGX. That's not a typo—$500 billion. Son has also been reshuffling his capital portfolio to fund these AI bets, recently selling a $5.8 billion stake in Nvidia Corp. (NVDA). (Yes, that Nvidia sale reportedly made him emotional, but that's another story.)
The strategy is clear: build the infrastructure layer that will power the AI revolution, and do it at scale. Acquiring a firm like DigitalBridge, which specializes in digital infrastructure investments, would give SoftBank even more firepower in that arena.
SoftBank Has the Financial Muscle for Big Moves
Can SoftBank actually afford this? The company's recent financial results suggest it has plenty of room to maneuver. In November, SoftBank reported strong second-quarter numbers driven by gains across its key businesses. Quarterly net sales rose to 1.92 trillion yen (about $12.99 billion) from 1.77 trillion yen a year earlier, while segment net sales increased 7.8% to 1.74 trillion yen.
The real story was in the investment portfolio. Arm Holdings Plc (ARM) posted 32% revenue growth to 167.4 billion yen and returned to profitability. SoftBank reported income before tax of 2.996 trillion yen and net income of 2.50 trillion yen, helped along by 3.44 trillion yen in investment gains and a 2.76 trillion yen Vision Fund profit.
The company also completed 330.3 billion yen in share buybacks, retired those shares, and approved a four-for-one stock split. In other words, SoftBank has been generating serious returns and returning capital to shareholders while still having cash to deploy on new opportunities.
What Happens Next
For now, all eyes are on whether SoftBank and DigitalBridge can finalize terms and announce a deal. The fact that talks are described as "advanced" suggests we could hear something soon, though dealmaking always comes with uncertainty until the ink is dry.
What's undeniable is that the market believes something is happening. A 30% premarket jump and a new 52-week high don't happen on vague rumors. Investors are clearly betting that SoftBank's infrastructure ambitions and DigitalBridge's digital infrastructure expertise make for a compelling combination.
Whether this deal ultimately closes at the rumored terms, gets restructured, or falls apart entirely remains to be seen. But for DigitalBridge shareholders who've watched their stock climb 23% this year and then rocket another 30% on Monday, it's been quite a ride.
