Shares of prominent technology investor SoftBank Group Corp. rose more than 5% today after the company announced it would receive $7.59 billion worth of shares in telecommunications provider T-Mobile US Inc. at no additional cost.
SoftBank said in a statement that it has directed T-Mobile US to issue 48.75 million shares of common stock after conditions set forth in its 2020 merger with Sprint Corporation are met, Reuters reported. Announced.
The Japanese tech conglomerate acquired Sprint in 2013 and sold the company to T-Mobile in 2020 for $26 billion. Under the terms of the deal, T-Mobile agreed to issue 48.75 million shares to SoftBank after 45 days of trading. The volume-weighted average price of the company’s stock exceeded $150 by the end of 2025. On Tuesday, T-Mobile stock closed at $156.83, triggering the provision.
T-Mobile confirmed in a regulatory filing that the 45-day volume-weighted price of its stock exceeded the threshold on Dec. 22 and will issue additional shares to SoftBank “promptly.” Then he added.
The deal means SoftBank has effectively doubled its stake in the carrier from 3.75% to 7.46%. “This increases the proportion of listed and measurable capital on SoftBank’s balance sheet and, even better, increases the evidential value of its debt,” Macquarie analyst Paul Golding said in a client note. “The proportion of certain capital increases.”
SoftBank stock had risen just 14% since the beginning of the year before today’s rally. Golding believes the group is currently trading at a discount of approximately 45.5% to its total asset value.
SoftBank CEO Masayoshi Son has been an avid investor in late-stage startups, but his ambitions have been dashed by some major reversals. For example, the company was a major backer of office-sharing company WeWork, whose parent company WeCo was eventually forced to file for bankruptcy.
Golding said T-Mobile stock boosts SoftBank’s internal rate of return on its Sprint investment to 25.5%. The company also received a boost from the rise in the stock price of semiconductor maker Arm, which closed on Tuesday at about 44% above its initial public offering price.
Photo provided by: Softbank
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