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Japan's Softbank May Acquire Sprint

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Sprint = $12.8 Billion T-Mobile = $39 Billion What's up with that?

mikkej2k

Oct 11, 2012, 7:41 AM
I would like to see the details so that I can understand the difference in the valuation of the deals.
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newfoneguy

Oct 11, 2012, 7:46 AM
lol. I'm jumping the sprint ship for a reason. But you have to keep in mind this is talks not a sale. Rumors at that.
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mikkej2k

Oct 11, 2012, 8:17 AM
You are right , it's talks not a sale. Until a deal is approved by regulators , company boards , shareholders , etc.

Just like AT&T and T-Moblie. Just talks of a $39 billion deal.
Verizon , now that's a sale of Alltel for $28.1 billion to VZW.
Sale- AT&T to Cingular for $41 billion
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newfoneguy

Oct 11, 2012, 8:24 AM
I very highly doubt spring will be sold for only 12.8 billion but i doubt they will go for very much. They have the one of the worst rated services from major carriers and its going to be VERY costly to upgrade their towers to a better LTE or such and investors are only going to buy it if they can make the money they are looking for which means they are going to try for a low price..
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Eric M. Zeman

Oct 11, 2012, 8:16 AM
T-Mobile USA isn't a publicly traded company. It's a subsidiary of Deutsche Telekom.

Sprint IS a publicly traded company. At the close of the market yesterday, its stock price was $5. Acquisitions of publicly-traded companies are almost always based on their stock price and the calculated sum of all the shares x the share price (approximately). There's also debt to consider and market capitalization. Sprint has a huge amount of debt.
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newfoneguy

Oct 11, 2012, 8:25 AM
Eric M. Zeman said:
T-Mobile USA isn't a publicly traded company. It's a subsidiary of Deutsche Telekom.

Sprint IS a publicly traded company. At the close of the market yesterday, its stock price was $5. Acquisitions of publicly-traded companies are almost always based on their stock price and the calculated sum of all the shares x the share price (approximately). There's also debt to consider and market capitalization. Sprint has a huge amount of debt.


^ what he said.
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mikkej2k

Oct 11, 2012, 8:25 AM
All true. You know the old saying : Buy low , sell high.
Makes you wonder what potential investors see for Sprint Nextels future. Softbank seems to see good things.
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newfoneguy

Oct 11, 2012, 9:28 AM
Eh. maybe not that good if they are only talking 12.8 so far. 12.8 sounds really low so i'm guessing they realize its going to take alot of work and money to turn sprint around.
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Haggard

Oct 11, 2012, 10:14 AM
I'm sure they are calculating all the debt Sprint is in as well. The iPhone wasn't cheap for them..it was about 20 billion alone.
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newfoneguy

Oct 11, 2012, 11:43 AM
20 billion for the right? or how much they spent on the first iphone orders? thats a bit high?
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Haggard

Oct 11, 2012, 12:17 PM
CNET states "Sprint has signed a $20 billion dollar deal for 30.5 million new iPhones"

I'll assume that this will be for a few iterations of the iPhone. This was the price to just get the iPhone with Sprint. Verizon probably paid the same, if not more due to them having more subscribers.
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newfoneguy

Oct 11, 2012, 1:25 PM
655 bucks a piece. I wonder what the spread was. how many of each size iphone. Either way apple made a ton...
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Haggard

Oct 14, 2012, 12:24 PM
Probably a ton of 16GB in black models. Those seem to be the popular ones.

They've been reselling used ones as well for $50 less with or without contract. They were either essentially damaged before, or activated and then returned and were in great condition. Those were pure profit so they have been recouping their losses through that way.
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vikes0115

Oct 11, 2012, 10:42 AM
There are a couple of key differences which prevent you from directly comparing those two figures.

First, the way the press release and corresponding news article are worded it appears that the $12.8 billion figure is what Softbank is expecting to pay to purchase the stock associated with this transaction. As such that figure would not include any of Sprint's debt. The T-Mobile debt that would have been assumed by AT&T is included in that $39 Billion price tag.

The debt would typically not be included in the transactional value, as Sprint likely will not end up as a solely owned subsidiary of Softbank.

This brings up the second key point, the $12.8 Billion figure does not necessary reflect a purchase of all of Sprint. There are r...
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