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BREAKING NEWS FROM CNBC’S DAVID FABER: SOFTBANK NEGOTIATING TO BUY 75% OF SPRINT NEXTEL

WHEN: Today, Thursday, October 11, 2012

WHERE: CNBC’s “Squawk Box

Following is the unofficial transcript of breaking news from CNBC’s David Faber. All references must be sourced to CNBC.

Video: Softbank in Talks to Buy 75% of Sprint Nextel: Report

DAVID FABER

: A LOT TO TALK ABOUT HERE IN TERMS OF A STORY THAT WAS BROKEN IN PART OVERNIGHT IN JAPAN. I’M TALKING ABOUT SOFTBANK’S TALKS TO ACQUIRE WHAT SOURCES TELL ME WOULD BE ROUGHLY A 75 PERCENT STAKE IN SPRINT AT A PREMIUM. THE TALKS CONTINUE AT THIS POINT AND HAVE NOT FULLY NAILED DOWN PRICE, ALTHOUGH THEY ARE CLOSE. SOME OF THE REPORTS OUT THERE HAD IT AT AN OVERALL PRICE OF 12.8 BILLION DOLLARS. LET ME STEP BACK FOR A SECOND THOUGH AND TELL YOU WHAT WE DO KNOW IN FACT BECAUSE THERE ARE SOME INTERESTING PARTS OF THIS AS WELL. THESE TALKS BEGAN THIS SUMMER AND ACTUALLY INVOLVES SPRINT, T-MOBILE – OWNED BY ITS PARENT DEUTSCHE TELEKOM – AND SOFTBANK, WHICH WERE TRYING TO PUT TOGETHER A DEAL UNDER WHICH SPRINT AND T-MOBILE WOULD GET TOGETHER, SOFTBANK WOULD THEN INVEST A SIGNIFICANT SUM OF MONEY TO OWN A MAJORITY OF THE COMBINED COMPANY, THEREBY HELPING TO CASH OUT LARGELY DEUTSCHE TELEKOM WHILE SPRINT SHAREHOLDERS WOULD ALSO OWN A DECENT PERCENTAGE OF THAT OVERALL COMPANY. THOSE TALKS FELL APART WHEN T-MOBILE AND ITS PARENT DEUTSCHE TELEKOM DECIDED THAT THE ANTI-TRUST RISK OF DOING A DEAL WITH SPRINT WAS SIMPLY TOO LARGE. AND AS WE KNOW, THEY WENT ON THEN TO MAKE A BID AND ACTUALLY HAVE A DEAL TO ACQUIRE METROPCS. BUT SOFTBANK PERSISTED AND STILL IS THERE. AND IN FACT, SOURCES CLOSE TO THE DEAL TELL ME, IT MAY BE ANNOUNCED IN THE NEXT WEEK OR TWO. THEIR MAIN MOTIVATION APPEARS TO BE THEIR INTEREST IN SPECTRUM. AND SPECTRUM OVERALL, NOT JUST CONTROLLED BY SPRINT, BUT ALSO BY ITS PARTNER CLEARWIRE. AND FROM WHAT I’M HEARING, PART OF THIS DEAL ALSO WOULD INVOLVE THE PURCHASE OF CLEARWIRE BY SOFTBANK. AGAIN, VERY MUCH UNCLEAR ON PRICE, CLEARWIRE ABOUT A TWO BILLION DOLLAR MARKET CAP COMPANY. IT IS ONLY A BUCK AND CHANGE IN TERMS OF THE STOCK PRICE. IT DOES HAVE A GOOD DEAL OF DEBT. REMEMBER, SPRINT OWNS 48, 49 – MAYBE IT IS EVEN MORE PERCENT OF CLEARWIRE – OF THE SPECTRUM. AND THEN YOU’VE GOT THE LIKES OF INTEL AND A NUMBER OF THE CABLE COMPANIES THAT OWN PART OF IT AS WELL. THEY WOULD WANT TO BUY OUT ALL OF THAT. APPARENTLY SOFTBANK’S INTEREST LIES LARGELY IN SPECTRUM – WHAT THEY BELIEVE THEY CAN DO WITH IT, HOW THEY BELIEVE THEY CAN TAKE ON IN A SIGNIFICANT FASHION THE DUOPOLY THAT SOMEWHAT EXISTS RIGHT NOW, AND WIRELESS PHONE SERVICE IN THIS COUNTRY BETWEEN VERIZON AND AT&T. A DRAMATIC DEAL, NOT YET DONE, UNDER WHICH SOFTBANK WOULD IN FACT ACQUIRE A MAJORITY OF SPRINT LEAVING A SMALL PUBLIC STUB, IN A SENSE. NOT YET DONE, BUT UNDERWAY AND VERY CLOSE IN FACT, TO GETTING DONE AT THIS POINT. WE ARE GOING TO HAVE A LOT MORE ON “

SQUAWK ON THE STREET

” OR EVEN “SQUAWK BOX” AS WE GET IT. GUYS, BACK TO YOU.



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