Softbank will buy a 70 percent stake in Sprint Nextel Corp. for about $20 billion, according to a report, citing unidentified people familiar with the transaction.
The agreement calls for a direct purchase by the Japanese telecom and media giant from Sprint of $8 billion in stock and a tender offer for an additional $12 billion from holders, CNBC reported yesterday.
The tender offer price is $7.30 a share, or 27 percent more than Sprint’s Oct. 12 closing price of $5.73.
The deal is intended to revitalize the third-biggest US wireless carrier into a more formidable competitor.
With the investment from Japanese billionaire Masayoshi Son’s Softbank, Sprint can fund a faster expansion of its 4G wireless network and could make further acquisitions aimed at challenging Verizon Wireless and AT&T.
“This could be the final and most important piece to reposition Sprint to compete effectively with AT&T and Verizon,” said Walt Piecyk, an analyst with BTIG LLC in New York, in an interview last week.
Sprint may seek to gobble up the rest of Clearwire or bid for MetroPCS Communications, people familiar with the matter have said.
Bill White, a spokesman for Overland Park, Kan.-based Sprint, declined to comment in an e-mail.