Softbank projects savings in Sprint merger

Dylan Bushell-Embling
telecomasia.net
Japan's Softbank, sticking behind its $20.1 billion offer for control of Sprint Nextel in the face of a rival bid, has asserted that its proposal would save Sprint over $3 billion a year by 2017.
 
In a regulatory filing, Softbank said it also projects more than $2 billion in average Sprint operating expense synergies and capex synergies of up to 36% through to 2017.
 
Opex projections are based on increased savings on device procurement, network opex and IT, as well as improvements in churn and customer care.
 
Expected capex savings are largely based on the improved economies of scale that would come from combining the purchasing power of Softbank and Sprint.
 
Softbank late last year offered $20.1 billion – including $12.1 billion for Sprint Shareholders and $7 billion in new capital – for a 70% stake in Sprint.
 
The deal was endorsed by Sprint management, but last month US pay TV and internet provider Dish Network made an unsolicited counter-offer of $25.5 billion for 100% of Sprint Nextel.
 
Softbank president Masayoshi Son has ruled out increasing its offer in response to the competing bid.
 
But he maintains that his company's offer is superior in terms of synergy, funding – Dish would need to raise around $9.3 billion in financing to pay for the purchase – and Softbank's expertise in the mobile sector.

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