Softbank completes USD12.4 billion refinancing deal

4 Dec 2006

Japanese telecoms conglomerate Softbank Corp has completed a JPY1.442 trillion (USD12.4 billion) refinancing deal for the mobile business it acquired from Vodafone Group, marking one of the biggest ‘whole-business’ securitisations on world record. However, the group notes that the interest costs on the deal will cut its pre-tax profits for the current fiscal year by JPY15.9 billion, as local interest rates have risen in the two-month period it took to complete the deal. The company has not divulged the rates it has agreed with its financiers although the transaction is believed to have been less than straightforward. The investment bank Goldman Sachs, which enjoys close ties with the company, last week exited the syndicate of banks involved in the deal. Analysts have expressed concern over Softbank’s ability to raise cash flow in a mobile market that is saturated and where its own share of the pie is small, and falling.

Japan, SoftBank Corp, SoftBank Group Corp