Japan's Softbank to reportedly take controlling interest in SprintShortly after rumors surfaced that Japanese telecommunications and internet company Softbank was looking to buy stake in U.S. wireless carrier Sprint, it is now being reported that the two firms have reached a deal.
Sources told Business Insider on Sunday that Softbank will pay $20 billion for a 70 percent stake in Sprint, with official word of the deal expected to be released on Monday.
While the details of the transaction are still being hammered out, the boards of both companies reportedly reached an amicable agreement in which Softbank will buy $8 billion of Sprint shares directly from the U.S. telecom and tender another $12 billion worth of shares from shareholders.
According to the report, Softbank will be paying a hefty premium for the tender offer at $7.30 a share, well over the stock's current price of $5.73. The agreement's design does not require a shareholder vote.
There are a few sticking points to the deal, however, as Sprint is in the midst of purchasing Clearwire. As part of the equity slated to be purchased by Softbank, a $3 billion convertible bond exercisable at $5.25 will be sold to provide funds for Sprint's acquisition of the 52 percent of Clearwire it doesn't yet own.
Softbank's Sprint buyout leaves only AT&T as the sole U.S.-owned major wireless operator in America, with number one carrier Verizon being a joint venture with Vodafone, and T-Mobile a holding company for Deutsche Telekom AG.
People close to the matter say Softbank is looking to build its wireless spectrum position with Sprint's existing network, and hopes to "further consolidate the wireless industry" through additional acquisitions.
The publication reports that the deal should be finalized within the next six months.
On Topic: General
- Rumor: Apple has made mockups of iMessage for Android with 'Material Design'
- Apple invention uses ferrofluids to enhance induction charging performance
- Apple patents crowd-sourced lost-and-found electronic tag service
- Apple replaces Support Profile web tool with 'Get Support,' limits information to registered devices
- Note 7 owners launch first of several class action lawsuits in South Korea