Last week it was revealed that negotiations were underway between Sprint and Japanese wireless carrier Softbank. A deal has officially been made with both boards of directors accepting the terms.
Today, Softbank announced that it agreed to acquire 70% of Sprint Nextel. The Japanese wireless company is set to purchase the stock for $12.1 billion as well as invest an additional $8 billion into Sprint. Sprint shareholders will get $7.30 a share, which is 27% more than Friday's closing price.
As anticipated, the new influx of capital will prove to be vital for Sprint helping it to reclaim some of its lost market share, and compete with the domineering U.S. competition.
Softbank has shared that it plans to use the $8 billion capital to help improve Sprint's networks as well as strengthen the company's balance sheet. Softbank CEO Masayoshi Son said in a statement:
"This transaction provides an excellent opportunity for Softbank to leverage its expertise in smartphones and next-generation high-speed networks, including LTE, to drive the mobile Internet revolution in the world's largest market. Our track record of innovation, combined with Sprint's strong brand and local leadership provides a constructive beginning toward creating a more competitive American mobile market."
While the deal does not have a scheduled end date, it will likely conclude in the middle of next year.