SoftBank Corp., the Japanese wireless carrier led by billionaire Masayoshi Son, plans to sell bonds for the first time after it abandoned talks to merge Sprint Corp. with T-Mobile US Inc.
Son's company is offering ¥400 billion in five-year notes to individual investors, and will price the debt on Aug. 28, it said in a filing to the Finance Ministry on Monday. The coupon will be in a range of 0.95 percent to 1.55 percent, according to the filing.
The debt sale suggests Son's failure to make the U.S. acquisition hasn't dampened his drive to raise funds to expand. Sprint, controlled by SoftBank, ended talks with T-Mobile less than two weeks ago on regulatory concerns, a person with knowledge of the matter said, leaving Son with America's No. 3 carrier in a market where it's dwarfed by larger rivals.
"If it's simply that SoftBank is raising funds at a cheap rate to refinance higher-cost debt, that would be extremely good" from a credit perspective, said Yusuke Ueda, a Tokyo-based credit analyst at Bank of America Merrill Lynch. "But that isn't 100 percent sure, and we don't know how much will be used for refinancing."
The funds will be used to repay debt and to finance future investment, SoftBank spokeswoman Mariko Osada said by phone from Tokyo. The cash raising isn't to finance specific mergers and acquisitions, she said.
SoftBank sold ¥300 billion in five-year bonds to individual investors with a 1.45 percent coupon in May after marketing the notes initially at 1.15 percent to 1.75 percent, according to data compiled by Bloomberg. It issued ¥700 billion of such notes last year, the data show.