& cplSiteName &

Softbank Eyes Sprint Acquisition

Ray Le Maistre
10/11/2012
50%
50%

Japanese network operator SoftBank Corp. is believed to be in advanced talks to buy a majority stake in Sprint Corp. (NYSE: S) for US$12.8 billion, reports Bloomberg, citing the Nikkei newspaper.

SoftBank is reportedly discussing a deal that would see it take a 66 percent stake in Sprint, the third-largest mobile operator in the U.S. with more than 56 million customers.

Softbank issued a statement saying: "The story about SoftBank and Sprint Nextel Corporation being reported is based on speculation. We have not announced anything. We do not comment on speculation."

The rumor will add to the current uncertainty about the future of the U.S. mobile market, as Sprint had allegedly been looking at a bid for MetroPCS Inc. (NYSE: PCS), which is currently on course to merge with T-Mobile US Inc. . (See Sprint Could Counter-Bid for MetroPCS and T-Mobile, MetroPCS to Merge.)

The latest speculation comes shortly after SoftBank announced its intention to acquire fellow Japanese service provider eAccess Ltd. in a deal valued at about $2.3 billion. That deal, if completed, will see eAccess, which has about 4.2 million customers, merge with SoftBank Mobile Corp. , the third-largest mobile player in Japan with more than 30 million customers.

For more on Sprint, see:



— Ray Le Maistre, International Managing Editor, Light Reading

(8)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
krishanguru143
50%
50%
krishanguru143,
User Rank: Light Beer
12/5/2012 | 5:19:20 PM
re: Softbank Eyes Sprint Acquisition




With someone looking into buying a stake into Sprint, I cannot see Sprint being able to acquire anyone at the moment.  I’m not sure Sprint could buy MetroPCS.  While they would need to beat $1.5 billion, Sprint only has around $6 billion in cash and financing the deal would add to their already $21+ billion in debt.  Their market cap is only $17 billion.




paolo.franzoi
50%
50%
paolo.franzoi,
User Rank: Light Beer
12/5/2012 | 5:19:17 PM
re: Softbank Eyes Sprint Acquisition


Ianbrown,


Confused on your comment and where it is going.  I assume you mean in opposition to:


http://www.lightreading.com/document.asp?doc_id=225526


seven


 

goundan
50%
50%
goundan,
User Rank: Light Beer
12/5/2012 | 5:19:17 PM
re: Softbank Eyes Sprint Acquisition


How does Softbank majority ownership affect Sprint's US Gov contracts for telecom services? If they have to drop or spin off US Gov contracts due to Softbank majority ownership issues, then it is quite likely that Huawei gets its first tier 1 break in the US.

krishanguru143
50%
50%
krishanguru143,
User Rank: Light Beer
12/5/2012 | 5:19:16 PM
re: Softbank Eyes Sprint Acquisition




No I didn’t, they go hand in hand.  If Softbank is looking at buying a controlling interest stake in Sprint, Sprint cannot be making any acquisitions.  Whenever a company is in takeover mode, they freeze hiring, acquisitions, etc.  The buyer is looking through the books and the last thing they want to see is books in fluctuation.  It also would harm the existing shareholders as if Softbank bought a 66% stake in the company and it was valued at a pre-MetroPCS buyout/merger but Softbank still got 66% ownership after the acquisition, then the existing 34% got the shaft.  In essence, Softbank just increased the value of their ownership stake while the existing shareholders saw a dilution.  The only time I saw where an acquisition and a merger took place at the same time, Verizon Wireless.  Vodafone and Bell Atlantic were merging their operations to form Verizon Wireless and Bell Atlantic was also going to buy GTE.  So pre-GTE Vodafone would own 55% of the new Company with Bell Atlantic owning 45%.  After the GTE acquisition, Bell Atlantic would own 55% and Vodafone would own 45%.

 

So if Softbank and Sprint are talking, then MetroPCS is off the table.  Sprint cannot afford to buy anything, their financials can’t handle it.  If it was an all-cash deal, it would get rid of over 25% of their cash reserves.  If they financed it, it would add to their existing debt and would surely drop their credit rating.  Even an all cash deal could drop their credit rating.  A drop in their credit rating, lower cash reserves, etc. could also either make Softbank ask for a higher ownership stake or they will pay less for their 66% stake.  Sprint could really only go after MetroPCS is Softbank agrees to it, but then Sprint is going to have to beat the offer DT has on the table.  This would certainly push the price Sprint would pay up as a bidding war would start.  You also have the board supporting the current T-Mobile/MetroPCS deal.  If Softbank wanted Sprint and MetroPCS, they would be better off bidding for the two separately.  So at the end of the day, you won’t hear anything about Sprint and MetroPCS.




paolo.franzoi
50%
50%
paolo.franzoi,
User Rank: Light Beer
12/5/2012 | 5:19:16 PM
re: Softbank Eyes Sprint Acquisition


One would think that Verizon Wireless (with its part ownership by Vodaphone) and T-Mobile (DT) should be able to provide you guidance to the US government contracts with wireless carriers partly or fully owned by organizations in friendly (read not China) countries.


seven


 

paolo.franzoi
50%
50%
paolo.franzoi,
User Rank: Light Beer
12/5/2012 | 5:19:15 PM
re: Softbank Eyes Sprint Acquisition


Well,  I do need to say my experience is different depending on the stage of the talking.  If they are in exclusive conversations, then yes talks with other parties are off the table.  If this is being floated as a trial balloon, then I would say Sprint could be talking to others.


For example, when AFC was bought by Tellabs we had just completed the Marconi NAA acquisition and in fact had our first round of Tellabs diligence done months before the Marconi deal.  We were talking to two other suitors than Tellabs but the Tellabs deal is the one that happened.  At that time, we were also talking to a COO (whose hire went on hold only after we had an LOI from Tellabs).  Normal front line hire/fire went on as normal during the entire process.  Only big things were put on hold.


Part of the reason is that bankers and companies approach management teams of reasonable companies all the time with deals.  Most of them are stillborn at the first discussion phase others actually have Corp Dev types talking and some of those move on to broader management discussions.  Only some of those move on to actual deal talks.  Until somebody ponies up a number its all foo foo.


seven


 

krishanguru143
50%
50%
krishanguru143,
User Rank: Light Beer
12/5/2012 | 5:19:15 PM
re: Softbank Eyes Sprint Acquisition




But since we are talking about Sprint that still hasn’t digested Nextel entirely.  Given that Sprint has confirmed the talks, they appear to be well underway and still a lot needs to be discussed.  If Sprint got into a bidding war and won though, their finances could not handle an acquisition.  There could also be a penalty from MetroPCS from not going through, which would certainly add to any price that Sprint would have to pay.




krishanguru143
50%
50%
krishanguru143,
User Rank: Light Beer
12/5/2012 | 5:19:15 PM
re: Softbank Eyes Sprint Acquisition




If Sprint did have to spin off the Gov’t contracts, I don’t Huawei would get a win.  The Gov’t could pull all funding for any public project that the non-Gov’t Sprint would be involved it.  Chances are, they would take the safe road and Huawei and ZTE would not be looked at as vendors.

 

Sprint does provide emergency responder service.  The Gov’t has a huge part of this service.  Sprint would see that business go away overnight; no public funding would be issued to them.




From The Founder
Kicking off BCE 2017, Light Reading founder Steve Saunders lays blame for NFV's slow ramp-up and urges telecom to return to old-fashioned standards building and interoperability.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
Women in Comms Introduction Videos
Cisco: Mentoring Critical to Attract & Retain Women

7|19|17   |   6:40   |   (1) comment


Liz Centoni, senior vice president and general manager of Cisco's Computing System Product Group, shares why mentoring in all its forms is important for women and what Cisco is doing that's made a difference for women in tech.
LRTV Custom TV
Gigabit LTE With Snapdragon 835

7|12|17   |     |   (1) comment


At an event in Wembley stadium, EE used its live network to demonstrate gigabit LTE using a Sony Xperia XZ Premium smartphone with a Qualcomm Snapdragon 835 chip.
LRTV Custom TV
Implementing Machine Intelligence With Guavus

7|12|17   |     |   (0) comments


Guavus unites big data and machine intelligence, enabling many of the the largest service providers in the world to save money and drive measureable revenue. Learn how applying Machine Intelligence substantially reduces operational costs and in many cases can eliminate subscriber impact, meaning a better subscriber experience and higher NPS.
LRTV Custom TV
Unlocking Customer Experience Insights With Machine Intelligence

7|12|17   |     |   (0) comments


When used to analyze operational data and to drive operational decisions, machine intelligence reduces the number of tasks which require human intervention. Guavus invested in Machine Intelligence early. Learn about the difference between Machine Learning and Machine Intelligence.
Women in Comms Introduction Videos
Verizon VP Talks Network, Career Planning

7|12|17   |   4:49   |   (0) comments


Heidi Hemmer, vice president of Technology, Strategy & Planning at Verizon, shares how bold bets and the future of tech define her career.
Telecom Innovators Video Showcase
Masergy's NFV Journey

7|11|17   |     |   (0) comments


Ray Watson, vice president of global technology at Masergy, discusses the advantages and challenges in entering the still-maturing NFV market for the past three years.
Telecom Innovators Video Showcase
Mavenir on RCS Cloud Platform & Multi-ID

7|10|17   |     |   (0) comments


Guillaume Le Mener, head of marketing and corporate development at Mavenir, discussed RCS and the recent launch of Multi-ID, which supports T-Mobile's DIGITS, the revolutionary new technology that breaks down the limitation of one number per phone and one phone per number.
LRTV Custom TV
ADTRAN Executive Outlines Trends in Next-Generation 10-Gigabit Cable Networks

7|10|17   |     |   (0) comments


Hossam Salib, VP of Cable and Wireless Strategy at ADTRAN, outlines key trends as MSOs begin to deploy next-generation Gigabit and 10-Gigabit cable networks. In the interview, Hossam outlines the advantages of a Fiber Deep architecture, FTTH options including EPON and RFoG, and the importance of SDN and NFV in building next-generation high-bandwidth cable networks.
LRTV Interviews
Global Capacity: Bandwidth Demand Driving Ethernet Growth

7|6|17   |   6:37   |   (0) comments


At Light Reading's Big Communications Event in Austin, Texas, Global Capacity's VP of Marketing Mary Stanhope talks about how the demand for bandwidth is changing the way service providers deliver broadband services.
LRTV Interviews
Colt's Services Chief on Digital Delivery

7|5|17   |   16:12   |   (0) comments


Rogier Bronsgeest, the chief customer experience officer (chief CEO!) at Colt, discusses the way in which the service provider interacts with its customers these days and his aggressive net promoter score (NPS) targets.
Women in Comms Introduction Videos
BT VP: Women Should Fill Security Talent Gap

7|5|17   |   6:00   |   (2) comments


By 2020 there will be six security jobs for every qualified worker, and Kate Kuehn, vice president of Security for BT in the Americas, says BT wants to encourage women to fill the shortage in jobs.
LRTV Interviews
Colt Sales Exec on Services Trends

7|4|17   |   12:59   |   (0) comments


Colt's sales director for enterprise, James Kershaw, sheds some light on the services currently in demand and how network upgrades are influencing customer demand.
Upcoming Live Events
September 28, 2017, Denver, CO
October 18, 2017, Colorado Convention Center - Denver, CO
November 1, 2017, The Royal Garden Hotel
November 1, 2017, The Montcalm Marble Arch
November 2, 2017, 8 Northumberland Avenue, London, UK
November 30, 2017, The Westin Times Square
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Mobile to Power Online Video Consumption – Zenith
Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation, 7/19/2017
Can Mushroom Sprout in Crowded SD-WAN Field?
Carol Wilson, Editor-at-large, 7/18/2017
AI Will Be Ubiquitous in 2020 but Overhyped in 2017 – Gartner
Sarah Thomas, Director, Women in Comms, 7/18/2017
Facing the Facebook Video Threat
Gary Miles, Chief Marketing Officer, Amdocs, 7/17/2017
Brocade, Broadcom Merger in Doubt
Iain Morris, News Editor, 7/19/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Following a recent board meeting, the New IP Agency (NIA) has a new strategy to help accelerate the adoption of NFV capabilities, explains the Agency's Founder and Secretary, Steve Saunders.
One of the nice bits of my job (other than the teeny tiny salary, obviously) is that I get to pick and choose who I interview for this slot on the Light Reading home ...
Animals with Phones
Fuzzy Quick Fix Click Here
If you can't access it, is it really broken?
Live Digital Audio

Playing it safe can only get you so far. Sometimes the biggest bets have the biggest payouts, and that is true in your career as well. For this radio show, Caroline Chan, general manager of the 5G Infrastructure Division of the Network Platform Group at Intel, will share her own personal story of how she successfully took big bets to build a successful career, as well as offer advice on how you can do the same. We’ll cover everything from how to overcome fear and manage risk, how to be prepared for where technology is going in the future and how to structure your career in a way to ensure you keep progressing. Chan, a seasoned telecom veteran and effective risk taker herself, will also leave plenty of time to answer all your questions live on the air.