SoftBank of Japan is nearing a deal to buy control of Sprint Nextel, giving the struggling American cellphone service provider a deep-pocketed backer to help finance its turnaround effort.
A transaction may be announced soon, a person briefed on the matter said on Thursday. But the person cautioned that the final details were still being negotiated and talks may still fall apart.
If a deal is completed, Sprint would gain substantial financial heft. SoftBank, one of Japan's biggest cellphone service providers, could provide additional resources for Spring build out its next-generation network.
Sprint has long labored in the shadow of its bigger rivals, Verizon Wireless and AT&T, and in recent years has sought to compete primarily on price. But the company risked being overshadowed by T-Mobile USA's plan to merge with MetroPCS, a deal that could create a tougher competitor in the lower end of the cellphone market.
Sprint had nearly purchased MetroPCS earlier this year, only for its board to veto the deal because it deemed the acquisition too expensive. Reports had said that Sprint was weighing making another run at MetroPCS, weighing down on the bigger service provider's shares for days.
Buying Sprint would give SoftBank an entryway into the American market, one of the largest in the world. The Japanese company has steadily surpassed rivals in its home country, in large part through acquisitions. Earlier this month, it agreed to buy a smaller competitor, eAccess, to become the second-biggest service provider in Japan.
A deal for a Sprint stake would be among the biggest in SoftBank's history, rivaling its $15.4 billion takeover of Vodafone‘s Japan operations. Shares in Sprint closed up 1.8 percent on Wednesday, giving the company a market value of about $15.1 billion.
Representatives for SoftBank and Sprint were not immediately available for comment.
