SoftBank Gains 5% Boost In Tokyo-Listed Shares With $7.6B Worth T-Mobile Shares

SoftBank Corp SFBQF has declared that it is set to receive $7.6 billion worth of T-Mobile US Inc TMUS shares at no extra cost, causing its Tokyo-listed shares to spike by 5%.

What Happened: According to Reuters, SoftBank announced late Tuesday that it had instructed T-Mobile U.S. to issue 48.75 million shares in common stock as part of an agreement relating to the merger of SoftBank’s U.S. telco Sprint and T-Mobile. This move will bolster SoftBank’s portfolio of listed assets.

The transaction effectively doubles SoftBank’s hold in T-Mobile US, boosting its stake to 7.64% from the current 3.75%. This follows the successful listing of chip designer Arm in September.

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Macquarie analyst Paul Golding noted the increase in SoftBank’s measurable equity and marginable equity relative to its indebtedness. As a result, SoftBank’s shares are on track for their largest gain in over a month.

Despite some investment reversals, including the WeWork bankruptcy, the T-Mobile US transaction increases SoftBank’s internal rate of return (IRR) on its Sprint investment to 25.5%.

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