SoftBank's share purchases help buoy Sprint's stock and boost market value by $6.7B

Sprint (NYSE: S) parent SoftBank's recent purchases of the carrier's shares have boosted its stock price up around 50 percent since before starting the buying spree in August. The share purchases are a reflection of SoftBank's confidence and have added $6.7 billion to Sprint's market value since Aug. 7.

As Bloomberg notes, as of Aug. 28, the Japanese company had purchased Sprint shares every day since Aug. 10, increasing its stake in the company to 82 percent, according to a filing with the U.S. Securities & Exchange Commission. SoftBank has said it intends to keep its stake in Sprint below an 85 percent threshold that would trigger a tender offer for the remaining shares, a condition of SoftBank's $21.6 billion deal to acquire Sprint in 2013.

SoftBank CEO and Sprint Chairman Masayoshi Son considered selling Sprint last year following the collapse of merger talks with T-Mobile US (NYSE:TMUS) amid regulatory opposition, but Son has since resolutely backed Sprint.

Son has said he sees "light at the end of the tunnel" for Sprint, even though the company has booked financial losses in six of the past seven quarters and burned through $2.2 billion in cash in its last fiscal quarter alone.

Sprint CEO Marcelo Claure, who took on the top job at the carrier in August 2014, has said he is giving himself three to five years in total to turn around the company. Claure is focused on a massive network densification for Sprint, which has still not formally started, and also plans to continue cutting costs. SoftBank and Sprint are financing the turnaround through new leasing companies for both devices and network gear. Claure also said that by year-end Sprint intends to move entirely to device leasing and away from two-year contracts and subsidized smartphones.

The rising share price, thanks to SoftBank's purchases, could also help Claure long-term if he can continue to improve Sprint's subscriber trends and financials. Last month Sprint extended Claure's contract until May 31, 2019, and said he will get 10 million shares of company stock if his turnaround efforts can push Sprint's stock to at least $8 per share and keep it there for a sustained period of time. Sprints stock is now at $5.21 per share, up from $3.36 on Aug. 7.  

For more:
- see this SEC filing
- see this Bloomberg article

Related articles:
Sprint's Claure gives himself 3-5 years for turnaround after 1 year on the job
Sprint extends Claure's contract until 2019, will give him 10M shares if he gets stock to $8
SoftBank buys $87M more in Sprint shares in show of confidence
Report: SoftBank floated idea of selling Sprint to Comcast, Altice amid turnaround
SoftBank's Son once considered dumping Sprint, now fully behind the carrier

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