WASHINGTON, AP – Softbank Corp. might sell a roughly 67 percent stake in smaller cellphone service provider eAccess Ltd. to South Korea’s Samsung Electronics Co. and 10 other companies as early as this month, sources said Saturday.
The telecom giant’s plan to reduce its stake and voting rights in eAccess to less than a third is in line with the Internal Affairs and Communications Ministry’s rules on allocating frequency bands to mobile phone carriers. Softbank is expected to reap several billion yen by offloading the shares.
Softbank, whose business has surged in recent years on the back of Apple Inc.’s iPhone, turned eAccess into a wholly owned subsidiary via an equity swap on Jan. 1. But the ministry has judged the acquisition as running counter to its policy of allocating frequency bands fairly to cellphone service providers.
The ministry only allocates frequency bands to such companies as long as they don’t have any affiliates in which they hold more than a third of the shares.
Softbank is planning to sell the stake to five foreign telecommunications-related firms, including Sweden’s Ericsson, and six domestic leasing companies, including Orix Corp., by dividing up and allocating a virtually equal number of shares to each buyer, the sources said.
Most of the eAccess shares that Softbank will hang onto do not have voting rights, they added.
Despite the transaction, Softbank and eAccess are likely to continue working closely together and will share each other’s frequency band as early as this spring, according to the sources.
Banks commit to Sharp
The main creditor banks of Sharp Corp. will continue to offer support to the struggling electronics maker even if its capital tieup talks with Taiwan’s Hon Hai Precision Industry Co. and Intel Corp. of the United States are unsuccessful, sources said.
Sharp’s negotiations on capital alliances with Hon Hai and Intel have stalled, but the lenders — Mizuho Corporate Bank and Bank of Tokyo-Mitsubishi UFJ — have determined it will be possible to continue providing assistance as the manufacturer’s business has been improving since last fall, the sources said Friday. The banks plan to continue lending a total of ¥360 billion to Sharp and to call on other financial institutions to maintain their cooperation with the company, the sources said.
According to the sources, Sharp has meanwhile postponed the compilation of a medium-term business plan until March from the initially planned February. The company has notified its creditor banks of the postponement and is fleshing out details of steps it intends to take to bolster its weakened capital base, they added, as well as ways to procure funds to repay corporate debts totaling ¥200 billion when they fall due in September.
Sharp’s performance in the October-December quarter improved thanks to strong sales of its advanced Igzo power-saving liquid crystal display panels, while sales of home appliances also fared well. But orders declined, mainly for LCDs from Apple Inc., the sources said.
In addition, the company is likely to have booked several billion yen in foreign-exchange gains as the yen weakened against major currencies at the end of last year. As a result, the company’s operating results are likely to have turned out better than the previously projected loss, the sources said.
With the business improvement, Sharp is seen as capable of booking an operating profit for the October to March period if its results for the January-March quarter do not fall far below estimates. As a condition for continuing to provide financial support, the banks had demanded that Sharp book an operating profit for the second half of the fiscal year.
In November, the company announced it expects to post a record group net loss of ¥450 billion for the year to March 31, due mainly to its flagging television business.
Toyota unions drop hike
The federation of unions at the Toyota Motor Corp. group said Saturday that for the fourth straight year, it would not submit a unified demand for a pay-scale hike at this spring’s “shunto” wage talks.
The Federation of All Toyota Workers’ Unions judged that it would be difficult to do so as earnings and business environments differ across Toyota group companies, union officials said.
But during an executive meeting in Kitakyushu, the federation agreed to call on Toyota and its subsidiaries to maintain seniority-based annual pay increases, according to the officials.
The executive also approved a plan to push for yearly bonuses in excess of five months’ worth of salaries, they said.
The federation, which covers about 326,000 workers belonging to 307 separate unions in the Toyota group, is the biggest umbrella labor organization in Japan’s auto sector. As such, its policies for the annual shunto labor-management negotiations draw attention from other unions across a wide range of industries.