SoftBank secures $23.3 bln refinancing for Sprint and ARM buys

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Japan’s SoftBank Group Corp said on Thursday it has secured a 2.65-trillion-yen (23.3 billion US dollars) senior loan agreement to refinance the acquisition loans for US telco Sprint Corp and British chip designer ARM.

SoftBank said the loan’s maturity is September 30, 2024. At a SoftBank board meeting last Friday, several directors expressed doubts about giving up control of Sprint, people familiar with the matter told Reuters, the latest twist in on-and-off talks to unite the two US wireless carriers that began earlier this summer.

According to tentative deal terms that Reuters was first to report last month, SoftBank and other Sprint shareholders would have received close to 40 percent or a little more of the combined company.

Reuters Photo

Industry watchers had long expected Sprint and T-Mobile to attempt another deal, especially after a quiet period associated with a US government auction of wireless airwaves concluded in April, freeing up companies in the telecom industry to discuss mergers and acquisitions.

Sprint is in the middle of a turnaround plan and has sought to strengthen its balance sheet by cutting costs. But industry analysts have expressed concern that the company, weighed down with total debt of 38 billion US dollars, has few financial options.

Analysts have expected consolidation in the US wireless industry to ease pricing pressure in the market, which could benefit AT&T and Verizon, who have lost share to their smaller rivals. Cable companies Comcast Corp and Charter Communications are also entering the market with wireless service on Verizon's airwaves.

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Source(s): Reuters