Japan-based SoftBank will sell up to about 198 million shares of T-Mobile (NASDAQ:TMUS) stock worth about $21 billion, the telecom company announced Monday.
The sale, which represents about 65% of SoftBank’s stake in T-Mobile, is part of SoftBank’s efforts to free up cash as the coronavirus pandemic has hurt several of its key investments. Prior to the health crisis, WeWork, a portfolio company of SoftBank’s $100-billion Vision Fund, failed to go public after its IPO prospectus was roundly criticized for its non-traditional corporate governance structure and huge losses.
In its May report to investors, SoftBank said the Vision Fund posted losses of $18 billion. That came after SoftBank previously announced in March that it would sell or monetize up to the equivalent of $41 billion in assets to buyback shares and reduce debt.
T-Mobile said in a press release Monday it would offer about 134 million of the shares SoftBank sells in the transaction to the public. It will give underwriters of the public equity offering the option to purchase an additional 10 million shares.
Marcelo Claure, a T-Mobile director and CEO of SoftBank Group International, will purchase five million shares after they are sold to T-Mobile, the company said in a filing with the Securities and Exchange Commission. Claure will buy the shares with proceeds of a loan from SoftBank, T-Mobile reported.
TMUS stock tumbled $1.83, or 1.7%, early Tuesday to $104.77.
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