By Kosaku Narioka and Mauro Orru
SoftBank Group Corp. said Tuesday that it agreed on a strategic partnership and an equity share swap with Deutsche Telekom AG in a move that would diversify its exposure in Europe, and increase the German telecommunications company's stake in its T-Mobile US Inc. business.
The Japanese technology and investment company said it would receive 225 million new shares in the German telecom company in exchange for about 45 million T-Mobile US shares it held, and that Deutsche Telekom also intended to acquire another 20 million T-Mobile US shares from SoftBank.
Deutsche Telekom's stake in T-Mobile US will increase by 5.3% to 48.4%.
"This agreement furthers Deutsche Telekom's strategic objective of increasing its ownership stake in T-Mobile US to more than 50% in order to maintain long-term control and consolidation," Deutsche Telekom said.
SoftBank said it would hold a 4.5% stake in Deutsche Telekom and become its second-largest private shareholder and intends to have board representation, and that it would retain a 3.3% equity stake in the U.S. mobile company.
Under the strategic partnership, SoftBank portfolio companies will gain access to Deutsche Telekom's customers across Europe and in the U.S.
Write to Kosaku Narioka at email@example.com and to Mauro Orru at firstname.lastname@example.org; @MauroOrru94
(END) Dow Jones Newswires