SoftBank plans to invest $16 billion in capital improvements at Sprint in the next two years, CEO Masayoshi Son said days before the acquisition closes on Wednesday.
Separately, as expected, Clearwire's shareholders on Monday approved Sprint's purchase of the remainder of Clearwire, which will expand Sprint's spectrum holdings.
Son told the Japanese news service Nikkei on Sunday that SoftBank wants to make Sprint, the number three carrier in the U.S., a more serious challenger to rivals AT&T and Verizon Wireless.
That $16 billion investment will more than double the pace of current capital growth, and most will go to base stations for Sprint's LTE network, Son said. After the next two years, the pace of investment will slow to about $6 billion a year. Sprint has about 90 cities on LTE today, well behind AT&T and LTE market leader Verizon.
Son also said that SoftBank and Sprint will open a joint hardware and software research center in Silicon Valley, employing up to 1,000 workers.
Son will be the chairman of Sprint's new board of directors, while Ronald Fisher, head of U.S. Softbank operations, will be deputy chairman. Sprint CEO Dan Hesse and three other Sprint directors will stay on and will be joined by Michael Mullen, former chairman of the U.S. Joint Chiefs of Staff.
Son said he's seen "considerable possibility for cutting costs" at Sprint, with up to $3 billion in annual savings by combining SoftBank's Japan purchases of base stations and smartphones with those of Sprint in the U.S.
SoftBank will set up a U.S. subsidiary that owns 78% of the new Sprint. On Friday, the U.S. Federal Communications Commission approved both the $21.6 billion acquisition of Sprint by SoftBank and the $3.7 billion acquisition of Clearwire by Sprint to gain possession of the entire company. The Clearwire shareholders were widely expected to approve that deal today and did so with 82% of the eligible votes. Sprint's shareholders approved the SoftBank deal on June 25.
Son said the SoftBank acquisition is expected to close on Wednesday.
Analysts said Sprint is poised to become a spectrum powerhouse with about the same amount of spectrum as both AT&T and Verizon combined.
Sprint also has about half as many customers as either AT&T or Verizon and may need to expand beyond its unlimited data offers to woo new customers, analysts said.
