Sprint shareholders vote for SoftBank’s $21.6-bn deal
26 Jun 2013
Shareholders of US wireless service provider Sprint Nextel Corp yesterday voted in favor of a sweetened offer from Japan's SoftBank Corp, ending a five-month takeover battle between the Japanese carrier and US satellite-TV provider Dish Network.
About 98 per cent of Sprint shareholders representing approximately 80 per cent of the company's outstanding common stock, voted in favour of the $21.6 billion deal, which would give SoftBank 78 per cent ownership of the third-largest US telecommunications company.
The deal is the largest overseas acquisition by a Japanese firm.
SoftBank had early this month sweetened its offer to $21.6 billion, topping a rival $25.5 billion bid for Sprint from Dish, the Colorado-based satellite-TV provider run by US billionaire Charlie Egren.
Last week, Dish opted out of the race and said that it would instead focus on its tender offer for Clearwire Corp, where it is waging a bidding war with majority shareholder Sprint. (See: Dish backs off from Sprint Nextel for now, to focus on Clearwire)
The transaction now requires the approval of the regulatory authorities, including from US Federal Communications Commission.
''Today is a historic day for our company, and I want to thank our shareholders for approving this transformative merger agreement,'' said Sprint CEO, Dan Hesse. ''The transaction with SoftBank should enhance Sprint's long-term value and competitive position by creating a company with greater financial flexibility.''
Overland Park, Kansas-based Sprint Nextel operates in the US under the Sprint, Boost Mobile, Virgin Mobile, payLo, and Assurance Wireless brands.
Sprint holds a 47.1-per cent stake in Clearwire, an 18 per cent interest in NI Holdings (International Nextel), and has more than 55 million customers.
It posted net income of $2.8 billion in 2011 on revenues of $33.6 billion. But Sprint, which has been losing money in all of the last 19 quarters, has net debt of about $15 billion, while Softbank has net debt of about $10 billion.
Softbank, which introduced Apple's iPhone in Japan, has around 30 million users, compared to more than KDDI Corp, Japan's second-largest mobile carrier's 36 million customer base, but far below market leader NTT Docomo, which has 60.5 million users.
The transaction, which SoftBank chairman and CEO, Masayoshi Son said will create the world's third-largest mobile-phone services provider by revenue, will have 96 million users and be in a better position to compete with industry leaders AT&T and Verizon.
