(Bloomberg) – T-Mobile US Inc. listed its shares at $ 103 each in a deal of more than $ 20 billion that will allow co-owner SoftBank Group Corp. to download a stake in the wireless operator, according to people familiar with the situation.
The mobile phone company, controlled by Germany’s Deutsche Telekom AG, presented plans for the share sale on Monday, but had not yet set a price for the shares. Almost 200 million shares are changing hands as part of the complex transaction.
SoftBank agreed to pay T-Mobile $ 300 million as part of the transaction and will cover all fees and expenses related to the agreement. The company became a co-owner of T-Mobile with Deutsche Telekom after the operator took over Sprint Corp. earlier this year in a $ 26.5 billion merger.
At $ 103, the shares are selling at nearly a 4% discount to T-Mobile’s closing price of $ 107.16 on Tuesday. They have gained 37% this year.
The deal, along with SoftBank’s plan to sell a 5% stake in its Japanese wireless affiliate, is part of a broader $ 42 billion push to download assets. The company aims to use the funds to finance the share buyback and pay off the debt. Masayoshi Son, the founder of the company, is dealing with heavy losses in his Vision Fund after noting the value of investments in WeWork’s shared economy to Uber Technologies Inc.
SoftBank will now turn its attention to other assets in its portfolio and may pursue a direct sale of part of its stake in Chinese e-commerce giant Alibaba Group Holding Ltd. Son said $ 11.5 billion raised from the issuance of contracts to sell shares In Asia’s largest corporation, it was a first step in undoing more of his possessions.
SoftBank “needs to further improve its cash reserves,” the Japanese company said in a statement Tuesday, citing concerns over “a second and third wave of Covid-19 spread.” The Japanese investment giant can invest the proceeds in high-quality securities until they are used for buybacks or debt reductions.
Goldman Sachs Group Inc., Morgan Stanley, Citigroup Inc., JPMorgan Chase & Co., Barclays Plc, Bank of America Corp., Deutsche Bank AG and Mizuho Financial Group Inc. PJT Partners oversaw a share offering due to be negotiated on Wednesday. In the meantime, he served as financial advisor to the T-Mobile board.
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