SOFTBANK, the Japanese finance house that has backed a number of leading global internet companies, has bailed out of the Irish banking software company Cognotec, booking a loss of more than $40m (€31.5m) in the process.

The Cognotec founder, Brian Macabba, and FinVentures, a unit of Standard Chartered Bank, have agreed to pay $9.5m for SoftBank’s 28.5% stake under pre-emptive rights it holds. The shares will then be purchased by Cognotec for the same price. Barclays Bank is providing the funds to the company for the share transaction.

The deal values the one-time technology star at just $33m, or a fraction of the $100m it has raised from investors since 1999.

SoftBank, an early investor in Yahoo!, invested $40m in Cognotec during two fundraising rounds in 1999 and 2000. Softbank Ventures, a related venture capital fund, invested a further $10m in late 2000.

Last year SoftBank purchased the venture fund’s stake and consolidated its interests into one holding. It was the largest backer of the Dublin firm, which sells software that allows large banks to manage currency trading online.

At one point, Cognotec was valued at close to $300m, but the firm has shipped heavy losses in recent years and its total accumulated losses top $92m. Large investment in software upgrades were partially responsible for the losses. The company returned to the black last year, posting an operating profit of $3.7m on annual revenues of $28.1m.

Macabba, who was at the centre of an Indecent Proposal-style court case involving the wife of a London rabbi that ended in 2004, is now the largest shareholder in the company. The software millionaire claimed that he had been slandered by the rabbi over the alleged incident, and sued. He lost what became the longest-running slander case in British legal history.

In a recent interview, Macabba said investors had been supportive during Cognotec’s tough years, adding that “some made money, some lost, but there were never tears”.

His stake is held in an offshore family trust.

Client Knowledge, a research company, estimates that spending on electronic foreign-exchange systems, currently estimated to be worth $400m per annum, will double by 2010.

Cognotec is targeting a 50% increase in revenues this year. The company employs 200 staff, including 145 in Ireland.