What does 1 trillion yen buy you? A majority stake in
Sprint Nextel (
if you're Japanese mobile carrier
Japan's No. 3 carrier is reportedly close to buying a
controlling portion of the third-largest mobile carrier in the
U.S. Details are still emerging and the deal is not yet final.
But the rumors are doing wonders for Sprint Nextel shares.
The stock is up 14.3% this morning to reach a new 52-week high
of $5.77 a share as of 11 a.m. eastern. At one point the stock
touched $6.00 for the first time in more than four years.
Softbank already has a lot of clout in the mobile phone
industry. The company distributes
in Japan and owns
, which it bought out in 2006. The company is worth more than $40
Sprint Nextel, meanwhile, has a market of about $17 billion.
It had a value of close to $70 billion in 2005, but has struggled
in recent years against increased competition from mobile rivals
Verizon Wireless (
. That 75% dip in value has certainly made Sprint Nextel a more
attractive takeover candidate.
Lately, though, Sprint Nextel has been making a bit of a
. Its cash on hand is at a six-year high, and shares surged 69%
in the third quarter due in part to improved iPhone sales. The
brighter outlook prompted some analysts to wonder whether Sprint
Nextel was preparing a takeover bid of its own.
Instead, it appears they are the ones being bought out.
Shares of both those companies are down slightly this morning
on news of Sprint Nextel's deal.
The stock that's making the biggest move as a result of the
impending Softbank-Sprint Nextel, however, is
. Sprint Nextel has a majority stake in Clearwire, a wireless
data company. Shares of that small cap stock are up 40%