SoftBank Corp. is considering acquiring T-Mobile U.S. Inc. as early as next spring, sources said Wednesday.
SoftBank, Japan’s third-largest mobile phone carriers, is studying the possibility of buying a majority stake in the No. 4 U.S. carrier through Sprint Nextel Corp., which was bought by the Japanese company in July, according to the sources.
The deal is expected to top ¥2 trillion in value, they said.
In the U.S. mobile phone market, the top two — Verizon Wireless and AT&T — boast more than 100 million subscribers each, against about 55 million for Sprint. With the acquisition of T-Mobile, if realized, SoftBank would come close to the top two with a subscriber base of nearly 100 million.
SoftBank is in talks with T-Mobile’s German parent, Deutsche Telekom, the sources said.
But SoftBank will have to overcome a regulatory hurdle. Deutsche Telekom agreed in 2011 to sell T-Mobile to AT&T, but the deal was opposed by the U.S. Justice Department because of antitrust concerns.
The cost for the acquisition of T-Mobile would be another headache for SoftBank, whose interest-bearing debts had swollen to ¥8.84 trillion as of the end of September after its purchase of Sprint.
The purchase would boost the SoftBank group’s annual revenue from mobile operations to $69.4 billion, making it the world’s No. 2 carrier behind China Mobile with $90.4 billion, the Nikkei said, citing industry figures.
SoftBank had initially envisioned a stock swap, but it is believed to have added a tender offer and other transactions to the list of options, since Deutsche Telekom prefers a cash deal, it said.
The Japanese group has begun talks with U.S. financial institutions for loans to finance the deal, it said.
SoftBank aims to compete better with the two US giants — Verizon and AT&T — by integrating T-Mobile with Sprint to create a stronger number three player with some 100 million subscribers, it said.
The deal needs approval by the U.S. Federal Communications Commission and the Department of Justice.
Number three U.S. mobile carrier Sprint in July closed a deal that allowed SoftBank to take a controlling stake for $21.6 billion, the largest overseas acquisition ever by a Japanese firm.
The SoftBank deal received clearance from U.S. national security officials on condition of appointing an independent member to the Sprint board of directors to serve as security director.