Softbank's CEO, in a battle with Dish Network to acquire U.S. mobile operator Sprint Nextel, slammed a $25.5 billion offer made by Dish, saying it is based on "imaginary" numbers and would create a company with "insane" amounts of debt.
Softbank chief Masayoshi Son said Tuesday the company would not increase its $20 billion bid for Sprint, made in October. The outspoken Son, who normally speaks in Japanese, made a rare English presentation filled with financial minutiae aimed at convincing Sprint's shareholders, who are to vote on his proposal in June.
"Some people ask me, 'Won't Softbank be increasing its price for the offer?'" Son said. "Why should we? We are already providing a better deal than the Dish proposal."
Softbank said in October that it had a deal to acquire a 70% stake in Sprint. Dish has said it would pay a $600 million cancellation fee if that deal doesn't go through.
Softbank and Dish are presenting two very different futures for Sprint, the third-largest carrier in the U.S., behind Verizon Wireless and AT&T by a wide margin. Softbank is hoping to create one of the world's largest carriers with strong market presence in the U.S. and Japan, two of the world's largest mobile markets, as part of its aggressive international expansion. Dish has said it wants to combine its own mobile spectrum and satellite coverage with Sprint's offerings to create a U.S. powerhouse.
Son said combining Softbank and Sprint made sense because both are mobile operators, and the newly formed company would be one of the largest in the world. He noted that both companies are aggressively rolling out high-speed LTE networks for smartphones, while Dish is in a different business as a satellite provider.
"Softbank plus Sprint, together we would become the biggest customer for procuring from Ericsson. We would be the biggest customer from Alcatel-Lucent. We would be the biggest customer from Samsung. We would be almost the biggest for (the) iPhone as well," he said.
Son said the $5.5 billion gap between Softbank's offer and the one made by Dish was deceiving for a number of reasons. He noted that the Dish proposal includes a large payment in stock, and some of the payment would be delayed for a year, while Softbank's payment would be made immediately in cash.
He repeatedly tore into the Dish offer, calling the debt it would require "crazy" and "insane." He said Dish's calculations for synergy with Sprint were an "imaginary number."
Also Tuesday, Softbank announced it had set a record for revenue and operating profit last fiscal year. The company said it made 289 billion yen in net profit, as its Japanese mobile business continues to grow. Softbank also operates a host of Internet companies, including Yahoo Japan, and has significant investments in Chinese online firms such as Alibaba and renren.