SoftBank Group looks to be gearing up for a busy 2023. After the Japan-based investor divested its early-stage VC unit, SoftBank Ventures Asia, The Financial Times has reported that SoftBank may cut its stake in Alibaba to just 3.8%.

SoftBank told the publication that its deals involving Alibaba shares signal its shift to “a defensive mode” as the company becomes more cautious about its investments. SoftBank also said the sell-off would improve its financial stability by increasing its liquidity.

The Japanese conglomerate might have signaled this transition earlier.

“When do we start playing offense, which is a quite difficult question, but I want you to also see the market situation,” SoftBank CFO and board director YOSHIMITSU GOTO had said in the firm’s latest earnings call.

SoftBank had also previously let go of some of its stakes in T-Mobile and Arm. Additionally, Arm is also reportedly looking to go public, which would aid in mixing SoftBank’s investments tied to listed firms, according to a note from Credit-Sights.

Credit-Sights, which is part of the Fitch Group, also noted that the Alibaba sell-off will make SoftBank more reliant on the performance of its Vision Funds for asset value.

“Though short-term cash will be bolstered, the long-term risks related to the shift in value towards the Vision Funds and the potential for this to signal another weak set of results offset this dynamic,” Credit-Sights highlighted.