Business / Corporate

SoftBank to make Yahoo Japan a subsidiary, lifting expected sales and profits

JIJI

Telecommunications carrier SoftBank Corp. said Wednesday it will make Yahoo Japan Corp. a consolidated subsidiary.

The share acquisition will help SoftBank log record consolidated sales and operating profit in the year ending in March 2020. At present, Yahoo Japan is under the wing of SoftBank Group Corp., the carrier’s parent.

Next month, the telecommunications arm will raise its equity stake in Yahoo Japan to 45 percent from 12 percent in terms of voting rights, by acquiring ¥456.5 billion in new shares that will be issued by Yahoo Japan.

The acquisition is aimed at maximizing the competitive edge of SoftBank through enhanced collaboration with Yahoo Japan’s operations beyond telecommunications, SoftBank President Ken Miyauchi said.

SoftBank expects sluggish growth in its mainline communications services for the current year due to planned cuts in mobile phone rates.

But with Yahoo Japan set to become a subsidiary, SoftBank’s consolidated sales are projected to expand 2.1 percent from the previous year to ¥4.8 trillion. Operating profit is forecast at ¥890 billion, up 3.5 percent.

For the year that ended in March, SoftBank earned an operating profit of ¥719.46 billion, up 12.8 percent, on sales of ¥3.75 trillion, up 4.6 percent. The growth reflected an increase in smartphone subscribers.