The private equity firm of Brightstar Capital Partners (BCP) announced it has signed a definitive agreement to acquire a majority stake in Brightstar, the Miami-based cell phone distributor founded in 1997 by former Sprint CEO and Chairman Marcelo Claure.
The purchase price was not disclosed. Once the transaction is final, BCP will own 75% of the company and SoftBank Group will retain a 25% stake.
SoftBank bought Brightstar for about $1.5 billion in 2014, but recently has been unloading assets, including this week’s big news that it was selling chip company Arm to Nvidia Corp. for $40 billion.
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Claure founded Brightstar as a distributor, buying handsets and reselling them in markets like Latin America. Claure was so confident in his endeavor that he combined the names of his two major competitors, Brightpoint and Cellstar, to form the company.
In 2014, SoftBank brought Claure in as Sprint CEO to replace Dan Hesse after Claure had built Brightstar into a global business worth $10.5 billion in gross revenue. SoftBank bought 70% of Sprint Nextel in 2012.
Claure is now COO of SoftBank Group. “Since I founded Brightstar over 20 years ago, the company has grown tremendously and become a leader of end-to-end device lifecycle solutions,” he said in a statement Thursday. “I am incredibly proud of what Brightstar has accomplished over the years and am excited for an even brighter future. SoftBank looks forward to partnering with BCP as Brightstar enters into its next phase of growth.”
SoftBank’s holdings in the wireless industry have been dwindling with the merger of Sprint and T-Mobile, and its holdings in Japanese carrier SoftBank Corp. dropped to 40%.
According to The Wall Street Journal, SoftBank announced nearly $94 billion in asset sales this year, even before Brightstar. That includes divestitures starting in March, when Vision Fund losses and stock-market drops prompted SoftBank CEO Masayoshi Son to announce $42 billion in asset sales to fund share buybacks and debt redemptions, according to the publication.
BCP, which was founded by former Brightstar COO Andrew Weinberg, is confident that it can help Brightstar, which has been losing money. Brightstar now serves carrier, retail and enterprise customers across about 50 countries, providing device insurance, supply chain management and trade-in services.
“We are thrilled to renew our relationship with Brightstar as it continues to build on the increasing importance of mobile technology around the world,” said BCP CEO Weinberg in a statement. “Having served as investors and operators in this industry for nearly two decades, including valuable time spent on the board at the company, we’re confident that our experience and commitment will help Brightstar continue to provide innovative services to the global wireless industry.”
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The transaction, subject to customary closing conditions, is expected to close before March 31, 2021, the end of SoftBank’s fiscal year.