Softbank Corp. said Tuesday it has agreed to pay 20 billion yen for the Fukuoka Daiei Hawks and its gaming rights, capping years of speculation on the fate of the athletically sound but financially ailing baseball team.
The move is the latest twist in one of the most tumultuous years in Japanese baseball, which has already seen one team added and two others merged.
The announcement comes 1 1/2 months after the Hawk’s zombie corporate owner, Daiei Inc., finally decided to seek rehabilitation under the Industrial Revitalization Corp. of Japan.
Despite insistent efforts to keep the high-profile team, the struggling retailer decided to sell after U.S. investment bank Colony Capital LLC, which acquired the team’s home stadium and adjacent facilities last year, endorsed Softbank’s bid.
Under the terms of the contract signed with Colony, Daiei is obliged to respect Colony’s choice when selling the team.
But the retailer’s ghost will get to hang around for some time, according to the terms of the deal.
“The most important thing for us is that we can continue to hold sales campaigns related to the team,” Daiei President Toshio Hasumi told a joint news conference in Tokyo.
Softbank Chief Executive Masayoshi Son said Softbank will allow the retailer to use the Hawks in its sales campaigns free for three years.
Under separate agreements, Softbank will pay Daiei 5 billion yen for the team and Colony 15 billion yen for ticket, broadcast and merchandising rights.
In addition, Son said Softbank would pay Daiei 4.8 billion yen annually to use the Hawk’s stadium, Fukuoka Dome.
With a projected annual revenue of 17 billion yen, it is estimated that the Hawks will post an annual loss of 1 billion yen, he said. He declined to say when the team might turn a profit.
Softbank filed its application for membership to Nippon Professional Baseball the same day. Pending approval by the NPB, which is scheduled to confirm the deal on Dec. 24, the Hawks will play under the ownership of Softbank Corp. from next season.
This year has effectively amounted to a bit of a shopping spree for Son and his company. The Hawks are the latest item in their shopping cart, which already contains Cable & Wireless IDC Inc. and Japan Telecom Co.
The other two acquisitions are key to Softbank’s bid to become a full-fledged telecom company.
But the ball team will give it far bigger recognition with the public, where the firm is a long shot for matching rival NTT Corp., a former state monopoly.
“We spend 100 billion yen annually on promoting our broadband service,” Son said.
If the ownership of the pro team helps improve Softbank’s brand recognition, “A billion to 2 billion yen is not much money,” he said.
For the Hawks, the deal means it will change hands for the first time in 16 years. Daiei bought the team from Osaka-based Nankai Electric Railway Co. in 1988, and moved from Osaka to Fukuoka, where it has enjoyed an enthusiastic local following.
Attention is now expected to focus on the fate of the Seibu Lions, which are also under financial pressure.