On Tuesday, Donald Trump announced that Softbank, the leading Japanese telecommunications company plans to invest a whopping $50 billion in the US economy, while creating about 50,000 jobs in the process. After meeting with the CEO of the company, Masayoshi Son for 45 minutes at the Trump Tower, the president-elect took to Twitter to announce the outcome of the meeting.
The Japanese company has a majority stake in Sprint, a company that had its plans to merge with T-Mobile thwarted by the Obama administration some months back. This meeting and the planned investment in the US will likely bring back the thought of a merger between Sprint and T-Mobile, and according to wireless analyst Chetan Sharma, “Son has a strong interest in pursuing the merger, and today’s visit is the groundwork for an inevitable deal.”
Son didn’t spell the details of the kind of deals he will be making in the US, but we got hints from something he told The Wall Street Journal, that they would, once again enter a previously announced $100 billion tech investment deal.
Silicon Valley is the world’s biggest and most promising startup environment, so if Son will be investing in this country, the tech hub will be enjoying a chunk of the sum, and this suspicion was even buttressed by the fact that he made this statement: “we would like to celebrate his presidential job (Trump) by investing in startup companies in the US.”
This deal may likely be the result of Trump making deregulation part of his plans as the failed attempt to merge Sprint and T-Mobile back in 2014 was actually due to deregulation issues. This has also made it very tough for the telecommunications giant to turn the fortune of Sprint, which it purchased for $20 billion in 2012.
Immediately after the announcement was made, the three companies, Softbank, T-Mobile and Sprint all had a rise in shares, and that’s a sign that investors are buying the idea, and they likely see success in the partnership. That assertion is backed by what Shun Tanabe, a telecoms analyst in Tokyo said, “Meeting with Trump created the possibility of discussing the merger that was rejected before, this is certainly a step forward.”
Tanabe also stated that he was stunned at how quickly Son had this meeting with Trump; well, I wouldn’t say it’s a quick meeting as one thing hardly happens in business and politics, and that’s ‘coincidence’, this was already in the airways for long.