Softbank Group: The end of American adventure

The Japanese technology Investor Softbank Group, sells almost two-thirds of its stake in American phone service provider T-Mobile US in the value of about 21 billion dollars (18.6 billion euros). At the same time, Softbankder Deutsche Telekom AG, the parent company of T-Mobile acknowledges, the Option to purchase the greater part of his remaining shares. A few days before the annual General meeting of the Japanese group approaches with the Transaktiondem the announced target, due to sales of shareholdings, the cash reserves of 41 billion dollars to increase. After a few failed investments in American Internet companies, Softbank had booked in the last fiscal year with $ 9 billion, the biggest loss in the history of the company.

Patrick Welter

a correspondent for Economics and policy in Japan, based in Tokyo.

For the charismatic Softbank founder Masayoshi Son, the sale of T-Mobile's shares, means the end of the American adventure. Son had taken up with Softbank in 2013, the American mobile telecommunications provider Sprint for 21.6 billion dollars, and hoped, the dominant providers, AT&T and Vodafone to the competition. The expectations were big. Already in Japan Son had mixed with the provider Softbank Corp., with aggressive Offers and cheap prices in the local market for mobile telephony in the swing.

Expansion without sustainable success

It helped that Son in negotiations with the Apple founder, Steve Jobs, the Coup was able to bring the iPhone in 2008, exclusive to Japan. Such advantage but Softbank was missing in America and it never did, to develop the smaller providers, Sprint to the competitors of the two Large. An attempt to merge with Softbank, with the then smaller providers T-Mobile, failed under the government of Barack Obama to the concerns of the antitrust authorities. In April, finally the merger comes, this time under the leadership of T-Mobile.

With the on Tuesday announced the business will be handed over to Softbank up to 198 million shares in T-Mobile at a value of about 21 billion dollars to the American companies. T-Mobile will offer these shares to the public on the private investors. Also Marcelo Claure, one of the Directors of T-Mobile, will buy part of the shares. For this selling service Softbank, T-Mobile pays 300 Million dollars plus applicable fees.

In a second step, deutsche Telekom has the Option to buy in the next four years, an additional 101 million shares to T-Mobile by Softbank, which currently have a value of about 10.8 billion dollars. Softbank is reduced so that the total of its share from 24.6 percent to less than 0.4 percent. Deutsche Telekom currently holds 43.6 percent of T-Mobile and with the auction the Chance to take the majority.

investors are critical

Son and his Softbank Group for months under the strict observation of the capital markets after the technology-Investor is to come up with some investment of almost $ 100 billion in hard-to-soft Bank Vision Fund in trouble. The IPO of American Internet ride service Uber, did not meet the expectations, and the attempt to support it with further billions of dollars the embattled office space landlords Wework, hangs in the air. Softbank has difficulties to find investors for the previously announced Vision Fund II, and has provided for this project for the time being. The fiscal year ending in March from the castle of Softbank Group, with a loss of 961,6 billion Yen (7.9 billion Euro). Softbank, according to media, about 15 percent of the 500 Points of the Vision reports in the deleted Fund.