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Sprint Nextel Corporation (NYSE: S) (“Sprint”) and SoftBank Corp. (OTC: SFTBY) (“SoftBank”) announced today that they have amended the previously announced merger agreement (the “Merger Agreement”) between the two companies to deliver greater cash consideration and increased certainty to Sprint stockholders. Sprint's Special Committee and Board of Directors have unanimously approved the amended Merger Agreement and have unanimously recommended to stockholders to vote FOR the revised SoftBank transaction. Sprint and SoftBank anticipate closing the SoftBank transaction in early July 2013, as previously communicated.

Under the amended Merger Agreement, SoftBank will deliver an additional $4.5 billion of cash to Sprint stockholders at closing, bringing the total cash consideration available to Sprint stockholders to $16.64 billion.

The cash available to stockholders has increased by $1.48 per share, from $4.02 to $5.50, based on the June 7, 2013 share count (assuming full proration).

The $4.5 billion of additional cash at closing will be funded by a reallocation of $3 billion of SoftBank's previously proposed $4.9 billion primary investment in New Sprint and by $1.5 billion of incremental capital from SoftBank.

The price at which SoftBank will acquire shares from current Sprint shareholders will be increased from $7.30 per share to $7.65 per share, a 52% premium to the unaffected trading price prior to announcement in October 2012.

As part of the amended Merger Agreement, the pricing of SoftBank's $1.9 billion primary investment will be increased by 19% from the previously agreed $5.25 per share to $6.25 per share. Pro forma for the transaction, the current Sprint stockholders' resulting equity ownership in a stronger, more competitive New Sprint will be 22% while SoftBank will own approximately 78%.

SoftBank will continue to invest $1.9 billion in New Sprint at closing, which in addition to the $3.1 billion convertible debt investment made by

SoftBank in October 2012, brings SoftBank's total investment in Sprint to $5.0 billion. SoftBank and Sprint believe that the reallocation of primary capital to Sprint stockholders is warranted given the companies' refined operating and capital expenditure synergy expectations resulting from extensive due diligence over the past nine months, as well as Sprint's improving profitability and execution of its Network Vision plan.

Posted-In: News Guidance M&A Global


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