|Day's Range||7.70 - 10.90|
“Surprising judicial activities” like the approval of a merger between Sprint and T-Mobile have disrupted the U.S. business environment, says AT&T President and COO John Stankey.
(Bloomberg) -- Masayoshi Son will head to New York next month for the first time since the implosion of WeWork, seeking to persuade hedge funds and institutional investors that the fortunes of SoftBank Group Corp. have turned since the disastrous investment.The Japanese billionaire is scheduled to address investors on March 2. There, he could point to the approved sale of Sprint Corp., a rally in Uber Technologies Inc. shares and Elliott Management Corp.’s purchase of SoftBank stock as signs of progress at his company, said people familiar with the plans. It’s unclear where WeWork will fit into the agenda.Within SoftBank, there’s disagreement about how to convey the company’s strategy. Son, 62, is known for his eccentric financial presentations, which have included a “hypothetical illustration” of WeWork profitability and stock photos of ocean waves and calm waters. One memorable slide from 2014 contained only a drawing of a goose and the words: “SoftBank = Goose.” Many staff at headquarters in Tokyo love the founder’s showmanship, but some senior executives are exasperated and argue a clearer and more sober message is needed, said people familiar with internal discussions who asked not to be identified because the matter is private.Ultimately, Son will decide. He has downplayed any pressure from Elliott, a New York-based activist investor that disclosed a nearly $3 billion stake in SoftBank this month. Son called Elliott an “important partner” and said he’s in broad agreement with the investor’s arguments for buybacks and increasing the stock price. Son has signaled less receptiveness to Elliott’s other suggestions: selling more of the stake in Alibaba Group Holding Ltd. and reining in the Vision Fund, a $100 billion investment vehicle that accounted for more than $10 billion of losses in the past two quarters.In private meetings with SoftBank, Elliott raised issues over the clarity of SoftBank’s strategy, people familiar with the talks said. SoftBank is planning to make hires within its investor relations department to help shape the message to shareholders. SoftBank declined to comment. A spokesperson for Elliott declined to comment.“Right now, serious heat is being applied on Son,” said Justin Tang, head of Asian research at United First Partners in Singapore. “Son has to be seen actually doing something.”Son’s heading into the meeting with one win under his belt: T-Mobile US Inc. and Sprint have agreed to new terms for their pending merger, a key step toward completing a transaction that will unload the loss-making carrier and unlock new capital for SoftBank. Its shares rose as much as 3.3% in Tokyo Friday.T-Mobile, Sprint Renew Deal as Merger Clears Regulatory HurdlesAlthough next month’s event was scheduled before Elliott disclosed its stake and is not designed to specifically address the activist investor’s involvement, it will be a focus for attendees, said people familiar with the preparations. Executives are bracing for questions about Elliott’s intentions and how far the shareholder will go to boost the stock’s value.Goldman Sachs Group Inc. is organizing the March event, the people said. The firm, which helped Japan’s Sony Corp. and Toshiba Corp. in their dealings with activist investors, is vying for the job of advising SoftBank on Elliott, said a different person said. However, SoftBank is likely to manage the relationship in-house, another person said. The job may fall to Marcelo Claure, the chief operating officer who’s helping oversee the WeWork debacle; Katsunori Sago, the chief strategy officer and a former Goldman Sachs executive; or Ron Fisher, a director and trusted adviser to Son. A Goldman representative declined to comment on SoftBank.Dogs and PizzaSoftBank is recovering from a series of stumbles in recent months. WeWork’s plan to go public last year imploded, forcing SoftBank to arrange a rescue financing of $9.5 billion in October. Uber, despite a two-month surge, is still trading about 10% below last year’s offering price. The Vision Fund has suffered other high-profile setbacks, including investments in failed online retailer Brandless Inc., dog-walking app Wag Labs Inc. and pizza robot company Zume Pizza Inc.Elliott has said it took the stake in SoftBank because the Japanese company’s shares are woefully undervalued compared with its assets. Son himself has been pleading the case with increasing frequency. SoftBank’s own sum-of-parts calculation puts its total value at 12,300 yen a share ($111). That’s more than double SoftBank’s actual share price, which values the company at about $104 billion. Elliott has pegged SoftBank’s net asset value at about $230 billion, people familiar with the discussions have said.The disconnect between what SoftBank and Elliott say the company is worth and the market value can be explained by several quirks of how the business is run, according to a report from Pierre Ferragu, an analyst at New Street Research. Many shareholders would like the company to return more capital and improve its governance, he wrote. Risks associated with the Vision Fund and a lack of details about tax liabilities associated with cashing out its investments are other factors.SoftBank recognized the need for more oversight as early as 2018, when it charged Claure with a broad review of operations across SoftBank companies. Claure, the former head of Sprint, spent months assembling a team of about 40 executives. In the end, he was forced to cede control of the so-called SoftBank Operating Group to the man it was supposed to be overseeing: Rajeev Misra, the head of the Vision Fund.Elliott wants SoftBank to set up a special committee to review investment processes at the Vision Fund. Elliott argues the fund has dragged down the share price despite making up a small portion of assets under management, said people familiar with the discussions.Some at SoftBank are resistant to the idea of an oversight committee. Instead, SoftBank is seeking to resolve issues at the Vision Fund with new governance standards for the companies it invests in. The new rules will encompass how the fund approaches the composition of the board of directors, founder and management rights, rights of shareholders, and mitigation of potential conflicts of interest.Son has conceded that missteps with the original fund is making it difficult to raise money for a successor. He said last week that SoftBank may need to invest in startups using solely its own capital for a year or two.‘Black Swan’Elliott is also calling for a buyback of as much as $20 billion. A repurchase of that scale could boost SoftBank’s shares by 40%, Ferragu estimated. SoftBank’s last share repurchase was announced about a year ago, a record 600 billion yen. It sparked a rally that pushed the stock to its highest price in about two decades.Selling Alibaba shares to pay for a buyback, as Elliott has proposed, could be a point of contention with Son. In the past, Son has used the shares as collateral to borrow money for big acquisitions, including the $32 billion purchase of chip designer ARM Holdings. Son said last week during a quarterly financial briefing that he’d prefer to sell as little as possible and that there’s “no rush” to do so.SoftBank said on Wednesday it plans to borrow as much as $4.5 billion against shares of its Japanese telecom unit. The company, which had 3.8 trillion yen of cash and equivalents at the end of December, said it was raising capital for operations. SoftBank’s debt load exceeds $120 billion.Son’s reliance on debt is raising alarms, said Tang, the financial analyst. “He’s going to get wiped out if there is some black swan event,” Tang said. “SoftBank needs to de-leverage, and the best way to do it is to sell the Alibaba stake.”Elliott has a tradition of using strong-arm tactics to get its way with target companies, but there’s little chance of that happening with SoftBank. Elliott’s stake enables it to call an emergency shareholder meeting, but pushing through a proposal without the founder’s backing is a long shot. Son, who often goes by the nickname Masa, controls more than a quarter of SoftBank stock through various vehicles, and the company bylaws require two-thirds of votes to pass any proposal made through the board, according to a person with knowledge of the rules.“Unless everyone is against him,” said Tang, “it’s not possible to dislodge Masa.”(Updates with share action in the seventh paragraph)\--With assistance from Scott Deveau.To contact the reporters on this story: Pavel Alpeyev in Tokyo at firstname.lastname@example.org;Giles Turner in London at email@example.com;Takahiko Hyuga in Tokyo at firstname.lastname@example.orgTo contact the editors responsible for this story: Peter Elstrom at email@example.com, Mark Milian, Colum MurphyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
T-Mobile has renegotiated the takeover terms of its more than $70bn purchase of smaller rival Sprint, paving the way for the consolidation of the third and fourth-largest players in US telecommunications after a hard fought legal battle. The recut deal will give German telecoms company Deutsche Telekom, the parent of T-Mobile US, 43 per cent ownership of the yet-to-be combined US wireless carrier. of the combined business, which will retain the T-Mobile name.
(Bloomberg) -- T-Mobile US Inc. and Sprint Corp. agreed to new terms for their pending merger, a key step to completing a transaction that has now cleared most regulatory hurdles.Under an agreement announced Thursday, T-Mobile owners will get roughly 11 shares of Sprint for each of their shares. That’s an increase from a ratio of 9.75 previously -- and a more favorable deal for T-Mobile parent Deutsche Telekom AG.SoftBank Group Corp., Sprint’s majority owner, agreed to surrender 48.8 million T-Mobile shares that it will acquire in the merger to the combined company immediately after the transaction closes. But those shares could be reissued to SoftBank by 2025 if the new company’s stock stays above $150 for a period of time.Sprint investors other than SoftBank will still get the original ratio of 0.10256 T-Mobile shares for each Sprint share -- the equivalent of about 9.75 Sprint shares for each T-Mobile share.When the transaction closes, which could happen as soon as April 1, Deutsche Telekom is expected to keep 43% of the merged entity, while SoftBank has 24%. The rest will be held by public shareholders.The original accord, which united the third- and fourth-largest U.S. wireless carriers in a $26.5 billion deal, was forged in April 2018. That pact lapsed on Nov. 1, and the companies didn’t initially renew the terms while they fought for government approval. When a federal judge rejected a state lawsuit to block the transaction earlier this month, that put the talks on the front burner.Along the way, Sprint’s condition has worsened. That added pressure to redraw the agreement so that it was more favorable to Deutsche Telecom.Sprint’s monthly churn -- a closely watched measure of how many customers leave -- has risen to nearly 2%. That means roughly a quarter of its subscriber base is quitting the carrier each year. And the company isn’t making up for the decline by charging more: Average revenue per customer has fallen 5% since the deal was announced.Analysts such as LightShed Partners’ Walt Piecyk said the merger’s exchange ratio should be closer to 12, given Sprint’s deteriorated business.To contact the reporter on this story: Scott Moritz in New York at firstname.lastname@example.orgTo contact the editor responsible for this story: Nick Turner at email@example.comFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Shares of Sprint S rose in after-hours trading Thursday after the company and T-Mobile announced revised terms of their $26 billion merger agreement which they said could be completed as soon as April 1. Under the revised deal, T-Mobile parent Deutsche Telekom will hold 43% of the newly created company, while SoftBank, the controlling holder of Sprint, will end up with 24%. Ordinary shareholders will see no difference in the exchange ratio for their stock - 9.75 Sprint shares for each T-Mobile share.
T-Mobile US, Inc. (NASDAQ: TMUS) and Sprint Corporation (NYSE: S) today announced that they have entered into an amendment to their definitive Business Combination Agreement to create the New T-Mobile. The Boards of Directors of T-Mobile and Sprint have unanimously approved the amendment. The amendment has no impact on T-Mobile’s previously stated outlook on the New T-Mobile’s synergies, long-term profitability and cash generation.
Under the revised deal, SoftBank will hold about 24% of the combined entity, down from 27% under the earlier terms. T-Mobile's parent Deutsche Telekom will hold about 43% of the combined entity, up from the 42% that the German group would have held. Shares of Sprint were up 5% to $9.95, while T-Mobile fell 1.5% to $98 in trading after the bell.
Verizon built its powerful brand around the quality of its wireless network. If Verizon stock is going to retain bragging rights with 5G wireless services, it's going to need more bandwidth.
It’s good to be at the top. J.D. Power today announced that T-Mobile (NASDAQ: TMUS) has once again taken the top spot in their 2020 U.S. Wireless Purchase Experience Study - Volume 1 for full-service providers. This is the fifth win in a row for the Un-carrier. And, T-Mobile snagged the top spot in every factor of the study with better, faster, more personalized experiences for customers shopping online, in-store and on the phone.
T-Mobile (NASDAQ: TMUS) today announced new deals for anyone looking to score the new Samsung Galaxy S20 5G, Galaxy S20+ 5G or Galaxy S20 Ultra 5G at the Un-carrier and jump aboard the first and only nationwide 5G network. And should the merger with Sprint close, only New T-Mobile can supercharge smartphones in this 5G lineup with mid-band spectrum. Get up to HALF OFF the latest Samsung Galaxy smartphones — the first smartphones in the U.S. that can tap into the full potential of 5G with low, mid and high-band — with an eligible trade-in OR snag a BOGO when adding a line. And both new and existing customers who want a sweet new 5G upgrade – from single line, to families, to businesses – can all score these deals. The Samsung Galaxy S20 5G lineup is available for pre-order online starting tonight at 9:01pm PT and will go on sale in T-Mobile stores on March 6.
The Zacks Analyst Blog Highlights: Facebook, Netflix, NextEra Energy, GlaxoSmithKline and T-Mobile US
While CenturyLink (CTL) matches fourth-quarter 2019 earnings estimates, Arista (ANET) surpasses the same despite lower revenues year over year.
(Bloomberg) -- SoftBank Group Corp.’s stock climbed after it unveiled plans to borrow as much as 500 billion yen ($4.5 billion) by putting up shares of its Japanese telecom unit as collateral, raising capital for the investment giant’s operations.The money for the two-year loan, which will have a one-year extension option, will come from 16 financial institutions, SoftBank said in a statement. It pledged as much as 953 million shares of SoftBank Corp. and said the money will be used to fund operations. SoftBank Group’s stock rose as much as 3.6% in Tokyo, while the unit’s was little changed.Activist investor Paul Singer this month revealed his firm had acquired a stake of as much as $3 billion in SoftBank and has advocated for a share buyback of as much as $20 billion, along with governance changes and more transparency about its investments. SoftBank founder Masayoshi Son called Singer’s Elliott Management Corp. an “important partner” and said he is in broad agreement with the investor about SoftBank buybacks and share value.SoftBank will need to raise cash to meet those demands. Son is adopting a more conciliatory stance just as he’s struggling with the $100 billion Vision Fund, which made him the biggest investor in technology. The fund lost money in the three months ended in December, one quarter after the meltdown at WeWork triggered a record loss for the Japanese company. Son is trying to raise capital for a second fund, but last week said he is no longer targeting $108 billion and SoftBank may finance the effort on its own.“We sense that the stars are now aligned for the firm to conduct a buyback,” Citigroup Global Markets analyst Mitsunobu Tsuruo wrote. SoftBank “will be in a position to flexibly implement a buyback amounting to” about 5% of its market capitalization.Read more: SoftBank’s Son Considers a ‘Bridge’ Fund Before Vision Fund 2The past 12 months have been tumultuous for Son and SoftBank. A year ago, the company unveiled a record buyback, sparking a rally that pushed shares to the highest since its dot-com peak in 2000. Uber Technologies Inc.’s disappointing public debut and the implosion of WeWork wiped out the gains over the next few months. But SoftBank surged again this month after Singer disclosed his stake and Son won approval to sell his Sprint Corp. to T-Mobile US Inc.SoftBank has 13.75 trillion yen of interest-bearing debt, with more than 2.6 trillion yen of bonds coming due in the next three years. The company also had 3.8 trillion yen of cash and equivalents as of the end of December.To contact the reporter on this story: Pavel Alpeyev in Tokyo at firstname.lastname@example.orgTo contact the editors responsible for this story: Peter Elstrom at email@example.com, Edwin Chan, Colum MurphyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
On the heels of a judge's approval of the Sprint/ T-Mobile merger, Dish shared additional details on its 5G plan during its fourth-quarter earnings call.
T-Mobile stock popped following a federal judge's ruling approving the Sprint merger. Here is what fundamental and technical analysis says about buying T-Mobile ahead of the merger closing.
Deutsche Telekom is aiming to become market leader in the United States, CEO Tim Hoettges said on Wednesday, now that a deal for its T-Mobile US unit to take over Sprint is within reach. Striking a bullish tone after a New York judge threw out a petition brought by a dozen U.S. states to block the deal, Hoettges said the 'new' T-Mobile would go on the attack and look to close a valuation gap with AT&T and Verizon .
Before a recent ruling in favor the T-Mobile merger, brokers fretted over concerns about what would happen to Sprint’s already diminished presence in Overland Park.
If you look at its fundamentals, Dish Network (NASDAQ:DISH) may seem a dumb place to park new money.Source: Jonathan Weiss / Shutterstock.com A few months ago, so was Sprint (NYSE:S).By that I mean that, if you want to buy DISH stock, you buy it as an arbitrage play. While Dish is a dying business, facing mammoth capital requirements, it could easily be bought by this time next year.InvestorPlace - Stock Market News, Stock Advice & Trading TipsDISH stock opened for trade Feb. 18 at $39.89 per share. That's a year-to-date gain of 16%. It has a market capitalization of $21.5 billion. But it's 6% below its most recent peak -- one it hit in July 2019. Five years ago, Dish was trading at $75 per share. What's the Deal?Dish Network began life in the 1980s as EchoStar Communications. It was one of two direct satellite broadcasters. The other is DirecTV, now part of AT&T (NYSE:T).As consumers began rejecting satellite, and other forms of cable, for streaming services, Dish rolled out Sling TV, a "cable-lite" package delivered online, in 2015. Since 2015, Dish has continued to shed customers, but Sling has hung in there, gaining 214,000 subscribers in the third quarter of 2019. * 9 Food and Restaurant Stocks to Dine In On But that's not the point, my friend. Dish has been a regular entrant in the Federal Communications Commission spectrum auctions throughout the decade. It has put $20 billion into wireless spectrum now estimated to be worth $30 billion.For years, however, Dish has been a "spectrum hoarder," refusing to build out services on what it owns. Early in its fight to buy Sprint, T-Mobile (NASDAQ:TMUS) even urged the FCC to take the spectrum away from Dish for that reason.But the two companies are now on better terms. That's because in July, Dish agreed to pay $5 billion for key T-Mobile assets, including Boost, Sprint's re-sale business. The deal helped pave the way for T-Mobile's merger with Sprint to be completed. Is Dish for Sale?Dish Network CEO Charles Ergen may be the richest man you never heard of. His stake in Dish was estimated to be worth $10.5 billion last year.Ergen is litigious, and often gets into arguments with his union. He may have also bit off more than he can chew with T-Mobile.Dish still hasn't built out its spectrum, which will cost $10 billion. If it doesn't get that done by 2025 it faces fines of $2.2 billion. Ergen is also 66 years old, young for a presidential candidate but old for a CEO. Which is why many feel the next step for Dish should be its sale.Who would buy it? Comcast (NASDAQ:CMCSA) has gotten nowhere with its Xfinity wireless service, which is based on the side bands of its own customers' WiFi signals. Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) is a re-seller of T-Mobile and Sprint services with its Google Fi. It could buy Dish for what amounts to seat cushion money. So could Apple (NASDAQ:AAPL).As wireless services continue to consolidate around AT&T, Verizon Communications (NYSE:VZ) and the T-Mobile and Sprint tie-up, many expect prices, for customers and re-sellers, to deteriorate.This is the last mile for the major cloud companies, the key connection they need with customers during this coming decade. They won't let the sun go down on it. The Bottom Line on Dish StockDish Network hasn't said it's for sale. But it is.Dish lacks the financial strength to compete in the wireless business. But there are buyers who would see AT&T and Verizon not just as peers, but as mere irritations. Comcast is nearly as valuable as they are. Google is worth about twice what the two wireless giants are, put together. Apple's worth $400 billion more than that.One of these companies is likely to make Charles Ergen a very rich man in the next few years. With earnings tomorrow, you can speculate on getting a share of it.Dana Blankenhorn has been a financial and technology journalist since 1978. His latest book is Technology's Big Bang: Yesterday, Today and Tomorrow with Moore's Law, essays on technology available at the Amazon Kindle store. Follow him on Twitter at @danablankenhorn. As of this writing he owned shares in AAPL. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 9 Food and Restaurant Stocks to Dine In On * 7 Micro-Cap Stocks That Could Double * 7 U.S. Stocks to Buy on Coronavirus Weakness The post Dish Network Is a Speculative Play Ahead of Wireless Changes appeared first on InvestorPlace.
Dish Network continues to bleed TV subscribers. The satellite TV provider lost 194,000 subscribers in the latest quarter as customers shift to online streaming services such as Netflix, as well as newbies Disney and Apple. What's more, the company also lost 94,000 subscribers from its own low cost streaming service, Sling TV. But the pay-TV subscriber loss was much smaller than what it had shed last year, and the company's rising profit handily beat Wall Street's estimates. That helped drive shares higher at the market open Wednesday. Dish also said it will enter the race for the next generation of wireless, 5G. It'll acquire Sprint's prepaid business once T-Mobile and Sprint complete their merger deal. That would make DISH the fourth-largest mobile carrier in the U.S., behind Verizon, AT&T and the soon-to-be combined T-Mobile and Sprint. Dish says it could spend up to $1 billion to build out its wireless network this year. Separately, the CEO of the majority owner of T-Mobile US, Deutsche Telekom, said Wednesday his company aims to overtake AT&T and Verizon in the U.S. - now that the deal to take over Sprint is back on track, after a New York judge threw out a petition by a dozen states to block the deal. -------------- Dish Network continues to bleed TV subscribers. The satellite TV provider lost 194,000 subscribers in the latest quarter as customers shift to online streaming services from Netflix and newbies Walt Disney and Apple. What's more, the company also lost 94,000 subscribers from its own low cost streaming service, Sling TV. But the pay-TV subscriber loss was much smaller than what it had shed last year, and the company's rising profit handily beat Wall Street's estimates. That helped drive shares higher at the market open Wednesday. Dish will enter the race for the next generation of wireless, 5G. It'll acquire Sprint's prepaid business once T-Mobile and Sprint complete their merger deal. That would make Sprint the fourth-largest mobile carrier in the U.S., pitting it against Verizon and AT&T. Dish says it could spend up to $1 billion to build out its wireless network this year. Separately, the CEO of the majority owner of T-Mobile US, Deutsche Telekom, said Wednesday his company aims to overtake AT&T and Verizon in the U.S. now that a deal to takeover Sprint is within reach.