US mobile carrier Sprint Wireless could go the way of T-Mobile and come under the ownership of a foreign company. Reports circulating on Sunday suggest that Japanese wireless carrier Softbank plans to acquire a 70% stake in the company.
The 70% stake will cost the wireless firm $20 billion.
Executives at Softbank and Sprint Wireless are expected to make a joint announcement on Monday morning. According to CNBC:
“While certain details are still being worked out, the boards of both companies have agreed in principle to the deal and are expected to officially ratify it this evening.”
Under terms of the deal Softbank will purchase $8 billion in Sprint shares directly from the company at a cost of $5.25, while tendering another $12 billion in shares from existing shareholders at a cost of $7.30. Because of the deals structure and high share premium Sprint Wireless will not need permission from shareholders.
Sprint Wireless is also working hard to purchase mobile data provider Clearwire, a deal that sources close to the company say will be wrapped up prior to closing the Softbank transaction.
Softbank has been successful in developing LTE wireless services in Japan and it hopes to continue that success in the United States where Sprint Wireless currently trails Verizon Wireless and AT&T Wireless.
If the acquisition is successful Softbank plans to acquire more wireless spectrum through various acquisitions, moves that will allow the company to develop a stronger network backbone that will ultimately lead to top-notch wireless services. Those services the company hopes will help the firm take market share from its top two competitors.
As Computer World notes, Softbank is also mulling over a “competitive bid” to purchase US regional carrier MetroPCS.