Softbank Group invested another US$87 million in Sprint Corp, underscoring billionaire founder Masayoshi Son’s commitment to turning around the money-losing US wireless carrier.
The Japanese carrier bought 22.9 million Sprint shares at an average price of US$3.80 apiece, increasing its stake to about 80 percent from 79.4 percent, the company said in a statement yesterday.
Sprint, which booked losses in six out of the past seven quarters, is showing signs of recovery after recording its third consecutive gain in subscribers.
Son last week said he already sees “light at the end of the tunnel” for the carrier, but the turnaround may take two years.
Sprint’s stock has climbed 15 percent this week.
“Son has made his commitment to Sprint very clear and this purchase fits into that story,” Tokyo’s Ace Research Institute analyst Hideki Yasuda said.
“Turning Sprint around will take a while,” Yasuda said.
Tokyo-based Softbank said it may make additional purchases while keeping its holdings to no more than 85 percent, which would make Sprint a target for delisting.
Softbank shares slumped 2.6 percent after one of its biggest investments, Alibaba Group Holdings Ltd (阿里巴巴), tumbled in US trading as a weaker Chinese economy weighed on earnings.
Alibaba shares fell to a record low of US$73.38 in New York on Wednesday, after sales climbed at the slowest pace in at least three years and transaction volumes missed analyst estimates amid a weakening Chinese economy.
The shares are still trading above the US$68 paid in September’s initial public offering, which raised a record US$25 billion.
Revenue rose 28 percent to 20.2 billion yuan (US$3.2 billion) in the three months that ended in June, down from an average of 56 percent in the previous 12 quarters.
The e-commerce operator also announced plans to buy back US$4 billion of stock over a two-year period, mainly to offset dilutions such as from its compensation programs, in its first buyback since listing.
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