Japanese mobile carrier Softbank has stepped up the pressure on the market when it announced it would acquire smaller rival eAccess Ltd in a deal worth $1.84 billion.
After adding eAccess’ 4.1 million subscribers, Softbank says it will surpass by number of subscribers rival KDDI, number two on the market.
Apparently, Softbank was keen to buy eAccess, since it accepted to pay Y52,000 for every eAccess share, which is more than triple the current share price (closing price on Friday was Y15,070).
“We are paying more than triple the current trading price of eAccess because the benefits come from the company’s existing customer base. We do not think our shareholders will view this as a bad tie-up at all,” said Softbank founder Masayoshi Son.
After the transaction, both Softbank and KDDI will have around 35 million subscribers, while the leader of the market remains NTT DoCoMo, with over 60 million subscribers.