Oct.15 - Japanese mobile operator Softbank says it will buy up to 70 percent of Sprint, the third-largest U.S. carrier, for over 20 billion dollars - the largest overseas acquisition by a Japanese firm. Ciara Sutton reports.
It's the most money a Japanese company has ever spent on an overseas acquisition. Mobile operator Softbank is to buy more than two thirds of Sprint Nextel, the third-largest U.S. carrier, for over 20 billion dollars. Analysts have long said the telecoms industry needs consolidation, but few looked to Japan as a catalyst. Softbank's billionaire founder Masayoshi Son said the deal would give them a valuable entry into the U.S. market. (SOUNDBITE) (Japanese) SOFTBANK PRESIDENT MASAYOSHI SON, SAYING: "Will we succeed? Let me answer: I am confident." Son is hoping that U.S. growth can offer relief from competition in Japan's saturated mobile market. But he's known for his risk-taking and investors aren't so sure. Softbank shares tumbled more than 8 percent on the news. Many are concerned that Son may be offering too much. Sprint has lost money every quarter for nearly five years and has debt of around 15 billion dollars. Dan Hesse is CEO. (SOUNDBITE) (English) SPRINT CEO DAN HESSE, SAYING: "Everybody was worried and we were worried about just surviving. As I mentioned, all the metrics were moving in the wrong direction. And I was asked by employees, and have been asked regularly, what are my goals for the company? And my goal has always been the same, and it's to create the best wireless carrier in America." Softbank entered the mobile carrier business in 2006 when it bought Vodafone's Japan unit for around 15 billion dollars. Combined, Softbank and Sprint will have 96 million users. Sprint admitted the move could be risky, but doing nothing was riskier. Ciara Sutton, Reuters.