SoftBank on course to buy T-Mobile

December 26, 2013 - 12:19:59 pm

A woman walks past the logo of Japan’s telecommunications giant SoftBank in Tokyo yesterday.

TOKYO: Japan’s SoftBank plans to acquire T-Mobile US through its subsidiary Sprint in a move that would create the world’s second largest mobile carrier by revenue after China Mobile, a report said yesterday.

SoftBank intends to buy a majority stake in fourth-ranked US wireless carrier T-Mobile in early 2014 in a transaction with an estimated price tag of more than 2 trillion yen ($19bn), the Nikkei business daily said.

It is in the final stages of talks with T-Mobile’s parent, Deutsche Telekom of Germany, the economic daily quoted anonymous sources close to the matter as saying. SoftBank declined to comment. 

The purchase would boost the SoftBank group’s annual revenue from mobile operations to $69.4bn, making it the world’s No. 2 carrier behind China Mobile with $90.4 billion, the Nikkei said citing, industry figures.

SoftBank had initially envisioned a stock swap but it is believed to have added a tender offer and other transactions to the list of options, since Deutsche Telekom prefers a cash deal, it said. The Japanese group has begun talks with US financial institutions for loans to finance the deal, it said.

SoftBank aims to compete better with the two US giants — Verizon and AT&T — by integrating T-Mobile with Sprint to create a stronger number three player with some 100 million subscribers, it said. The deal needs approval by the US Federal Communications Commission and the Department of Justice.

Number three US mobile carrier Sprint in July closed a deal that allowed SoftBank to take a controlling stake for $21.6bn, the largest overseas acquisition ever by a Japanese firm. 

The SoftBank deal received clearance from US national security officials on condition of appointing an independent member to the Sprint board of directors to serve as security director.

AFP

comments powered by Disqus