Just what the title says here, folks: Softbank and Sprint have reached a deal that will transfer 70% of Sprint's shares to the Japanese telecom giant. The price? A cool $20 billion - a premium significantly above Sprint's $17 billion market cap, 70% of which would be just $12 billion. The deal will involve Sprint selling $8 billion of stock directly to Softbank, and another $12 billion that will be acquired through Sprint shareholders, at a price of $7.30 a share. Considering Sprint stock hit a rather staggering low approaching $2 earlier this year, it's not like they're exactly getting a raw deal.

What about the extra $3 billion of the $23 billion Softbank has apparently secured to fund the purchase? That money will allegedly go toward paying down some of Sprint's debts, as well as funding a continued Sprint acquisition of Clearwire, which Sprint already owns a rather large portion of. According to CNBC, a prerequisite of the Softbank deal is Sprint having governance over Clear.

If all goes according to plan (read: regulatory approval), the transaction is expected to close in the next 6 months. After the failed acquisition of T-Mobile USA, the US's fourth-largest national carrier, by AT&T earlier this year, a successful takeover by a Japanese telco of a major American wireless provider would certainly be a bit of a belated slap in the face for Ma Bell.

The deal is expected to be announced Monday, and after the transaction is completed, Softbank's strategy will allegedly be to expand the company's spectrum holdings, through auctions and acquisitions of other, smaller providers.

MSNBC via Engadget

David Ruddock
David's phone is whatever is currently sitting on his desk. He is an avid writer, and enjoys playing devil's advocate in editorials, and reviewing the latest phones and gadgets. He also doesn't usually write such boring sentences.

  • John O’Connor

    I was just reading this now!!

  • Freak4Dell

    According to the CNBC story, shares that are bought from existing shareholders will actually be priced at $7.30, not $5.25.

    • http://www.androidpolice.com/ David Ruddock

      Yeah, they re-revised shortly after I published - for the third time. MSNBC can't seem to keep their story straight.

  • AaronGingrich

    70% of $17billion is about $12bn. They aren't paying a $3bn premium, it's an $8bn premium.

    • HellG

      which stupid amount of money! anyone knows why are they paying all that much?

  • yankeesusa

    This is great! Now i will definitely keep sprint for now and see what happens. I can't wait to see the future of lte for sprint now that they will have the funds. Especially since my town is on the list to get it before end of year and I will be getting the note 2 soon.

  • http://www.androidpolice.com/ Artem Russakovskii

    Sprint is announcing it in 1.5 hours in a special webcast at http://newsroom.sprint.com/news/

  • http://twitter.com/ChadStovall Chad Stovall

    Cautiously optimistic...