Japanese Carrier Softbank Buys Controlling Interest in Sprint

[MacRumors]

As was rumored last week, Japanese carrier Softbank is purchasing 70% of Sprint for $20 billion. The deal is expected to be announced tomorrow morning, but the boards of both companies have agreed to the transaction. Softbank will buy $8 billion in shares directly from Sprint, and another $12 billion from existing stockholders at $7.30 per share, a 27% premium from Friday's close.

The purchase is a huge one for Softbank, which is essentially making a $20 billion gamble that it success in developing LTE wireless services in its home market of Japan can be translated to the U.S. Sprint, while the third largest wireless provider in the U.S., significantly trails the two market leaders, Verizon and AT&T.

Softbank's hope, say people familiar with its strategy, is to build on Sprint's spectrum position, while hoping the company can further consolidate the wireless industry through acquisitions of more spectrum and other operators. The deal is expected to close in roughly six months.

This puts another major carrier in the United States in foreign hands. Verizon is 45% owned by UK carrier Vodafone, T-Mobile is owned by German-firm Deutsche Telekom, and Sprint will now be majority owned by Softbank. There are no details regarding Sprint's branding in the US, or if Softbank will begin promoting itself within the country.

Sprint became the third of the four major U.S. carriers to offer the iPhone upon the release of the iPhone 4S in October 2011, with company executives moving to "bet the company" on the iPhone in committing to purchase more than 30 million iPhones worth $20 billion over the first four years of the partnership. The move has impacted Sprint's financials over the short-term, but the carrier believes that the long-term effects of having the iPhone will be positive.

Article Link: Japanese Carrier Softbank Buys Controlling Interest in Sprint

[opnr2000]

Good luck and lets hope more competition drives down prices.

[FrauHasSpoken]

staying american with at&t

[puma1552]

so the worst of the big three japanese carriers bought the worst of the big three american carriers?

cool strategy

[iansilv]

What is this going to do to the stock price tomorrow?

[w00t951]

AT&T should play the patriotism card. "If you want to support your country, select AT&T!*"

*Decent service not included.

[MattMJB0188]

Originally Posted by iansilv

What is this going to do to the stock price tomorrow?

Who cares?

[Callumbear845]

Here's to hoping it goes up!

[iansilv]

Originally Posted by MattMJB0188

Who cares?

I do. That's why I asked the question. See, by asking the question, I answered yours...

[ConCat]

Great! Perhaps Sprint will be run less poorly now. Only time will tell.

[ChristianJapan]

Originally Posted by puma1552

so the worst of the big three japanese carriers bought the worst of the big three american carriers?

cool strategy

Good luck ... I also wish they would invested that money into their local business/network first. It getting really slow these days with all the smartphones

[jav6454]

Pretty soon, SoftBank USA.

[marksman]

Originally Posted by FrauHasSpoken

staying american with at&t

Me too. Our communication. Infrastructure is too important to rely on foreign countries.

[EstaVidaLoca]

If Verizon or ATT offered "unlimited data" ever again to new activations I'd leave Sprint in a heartbeat.

[barkomatic]

With Softbank's resources, Sprint could expand its LTE market to every major city. That would make their unlimited plans quite attractive if they keep them.

[Youknowitsme]

Originally Posted by EstaVidaLoca

If Verizon or ATT offered "unlimited data" ever again to new activations I'd leave Sprint in a heartbeat.

You and me both. I just left AT&T for Sprint. What really drove me away was the separate charge for FaceTime. Granted i wont use facetime over 3G, but its the principle of it. I pay for my data, let me use it as I please. Its just a gimmick to get grandfathers off their plan

[dontwalkhand]

I can imagine Americans thinking that Sprint is now owned by a Japanese bank.

----------

Originally Posted by barkomatic

With Softbank's resources, Sprint could expand its LTE market to every major city. That would make their unlimited plans quite attractive if they keep them.

Well we would at least grandfather in to the old ones, and we would have unlimited LTE for a price lower than the other guys!

----------

Originally Posted by marksman

Me too. Our communication. Infrastructure is too important to rely on foreign countries.

Too bad that "our communication infrastructure" is now running at the speeds of .002mbps, so if a foreign country can do a better job, have at it. I am not staying with something "American" just because it is American, if they want me to stay American, make a better product (You know, like capitalism is designed to do!!!)

[NeroAZ]

Originally Posted by w00t951

AT&T should play the patriotism card. "If you want to support your country, select AT&T!*"

*Decent service not included.

They already bill themselves at the only American Union company. http://www.unionplus.org/cell-phone-...s/att-wireless

[jayducharme]

Originally Posted by dontwalkhand

if they want me to stay American, make a better product (You know, like capitalism is designed to do!!!)

In an ideal world that would be true. But these days it seems like capitalism is designed so that huge companies can make huge profits with as little effort as possible. The big telecoms offer similar services at similar prices, as do the cable companies, utilities, gas stations, etc.... There's a happy illusion of choice.

My happy illusion currently is AT&T.

[NeroAZ]

Originally Posted by FrauHasSpoken

staying american with at&t

I did too on my iPhone 5, but not because I like AT&T. I bought a Verizon 3rd gen iPad and find I drop to 3g way more than I like. I figured at least if I lose LTE coverage on AT&T I will drop to a faster 3g/4g network.

[SandboxGeneral]

Originally Posted by MattMJB0188

Who cares?

Probably folks who own shares of Sprint stock.

[BasicGreatGuy]

Curious to see what, if any, impact this has on the current promise of unlimited data plans, not to mention data improvements and service.

[Ran7]

Originally Posted by SandboxGeneral

Probably folks who own shares of Sprint stock.

Healthy competition drives down prices. Sprint also did merely lead every innovation in the past then years with US carriers -- first with widespread, first with 2g, first with 3g and first with (albiet problematic) 4g -- it also led by being the most open, not using the walled garden approach of Verizon. That is beyond the unlimited data and lower prices.

Its data network is obviously stressed because of financing plus the problem with wimax. More money is the only thing needed to solve that and this buyin means more money.

VErizon continually had manufacturers remove features already present on phones it adopted if those features harmed their walled garden revenue approach. That included removing standalone GPS back when GPS nav was an added paid feature, and even disabling handsets' abilities to send camera pictures over bluetooth when Verizon had a $0.20 a picture over network scheme to get your pictures off your own phone. Verizon refused to unlock worldphones for years when Sprint readily did so as well

i cant see who in their right mind would be interested and happy with this

[ChristianJapan]

Originally Posted by dontwalkhand

I can imagine Americans thinking that Sprint is now owned by a Japanese bank.

Not really a bank

http://www.softbank.co.jp/en/info/profile/history/

http://www.softbank.co.jp/en/info/profile/identity/

[japanime]

As a Softbank customer stuck in a two-year contract (that will thankfully expire in April), I can say this with certainty: Sucks (now) to be a Sprint customer.