Softbank Wants To Buy Sprint For $19 Billion, Speed Up 4G LTE Rollout [Update]
Japanese carrier Softbank is in talks to buy Sprint for $19 billion as a way to enter the U.S. market according to a Bloomberg report.
The Bloomberg report cites a report from Japanese paper Nikkei which talked to two people familiar with the matter. According to one of those sources, Softbank wants to acquire two-thirds of Sprint with its $19 billion proposition.
Softbank is also interested in purchasing Clearwire, a Sprint partner for 4G LTE. Clearwire uses the same frequencies and variant of 4G TDD-LTE of Softbank which could mean easier interoperability between the two networks in the U.S. and Japan if the deal goes through.
Update: Sprint confirmed that it is in discussions with Softbank concerning “a potential substantial investment.” The full statement reads:
Sprint today confirmed that it is currently engaged in discussions with Softbank regarding a potential substantial investment by Softbank in Sprint. Although there can be no assurances that these discussions will result in any transaction or on what terms any transaction may occur, such a transaction could involve a change of control of Sprint. Sprint does not intend to comment further unless and until an agreement is reached.
If the Sprint and Clearwire deals go through Softbank would be able to provide both companies with more financial support. With more money Sprint can more easily compete with AT&T and Verizon which control a large portion of the U.S. mobile market.
That added financial support could mean a faster 4G LTE rollout for Sprint which recently started to rollout the new network. With a faster rollout Sprint can more easily catch up with AT&T in terms of total 4G LTE coverage area. That means more viable 4G LTE options for more users, which is always a good thing.
If this deal goes through it could mean Sprint won’t follow through with its counter-offer to MetroPCS to stop it from merging with T-Mobile. In the end that will likely benefit both Sprint and T-Mobile, making both companies more capable of competing with AT&T and Verizon.
Softbank was the first Japanese carrier to carry the iPhone in the country, and is currently third place in that market.