A SoftBank Corp. store sign in Tokyo’s Ginza district on Wednesday, November 1, 2023.
Kiyoshi Ota | Bloomberg | Getty Images
SoftBank Group shares rose 5% on Wednesday after the Japanese tech conglomerate said it would receive about $7.59 billion worth of shares in telecommunications company T-Mobile US at no additional cost.
Masayoshi Son’s conglomerate late Tuesday offered 48.75 million common shares to T-Mobile US after conditions set out in an agreement struck as part of the merger between SoftBank-owned U.S. carrier Sprint and T-Mobile were met. announced that it had instructed them to issue the .
The deal strengthens the publicly traded assets of SoftBank’s portfolio and follows the listing of blockbuster chip design company Arm in September, doubling its stake in T-Mobile US to 7.64% from 3.75% currently.
“This increases the proportion of listed and measurable capital on (SoftBank Group’s) balance sheet and, even better, increases the ratio of “The proportion of spare capital will increase.”
SoftBank shares posted their biggest rise in more than a month. The conglomerate is up about 14% year-to-date, compared with a nearly 30% rise in the benchmark index. According to Macquarie calculations, the group trades at a discount of around 45.5% to asset value.
Son, a major investor in late-stage startups, has suffered a series of reversals, including the bankruptcy of office-sharing company WeWork, once America’s most valuable startup.
The T-Mobile US deal increases SoftBank’s internal rate of return on its investment in Sprint to 25.5%.
Other positive news for the company include the recent rally in Arm’s stock, which closed Tuesday at about 44% above its initial public offering price.