Softbank's Son Trying to Sell Trump on Sprint, T-Mobile Merger

Masayoshi Son, Chairman of Sprint owner Softbank, this week promised President Elect Trump that he would somehow invest $50 billion and bring 50,000 jobs to the United States. Son made the promise to Trump in a meeting at Trump Tower in Manhattan, saying the funds would come from a $100 billion investment fund that SoftBank Chief Executive Masayoshi Son is setting up with Saudi Arabia’s sovereign-wealth fund and other potential partners.

Son is trying to sell Trump on the idea of letting Sprint acquire T-Mobile, a deal that was blocked under the Obama administration because it would have made the sector less competitive.

Ever since the deal was blocked, Son has repeatedly made it clear he'd try the merger again if there was a shift in regulatory oversight.

"If Son feels that person is more amenable to a combination to take on market leaders AT&T and Verizon, he will probably try again, said the people, who asked to not be identified because the matter is private," Bloomberg said back in August.

It's now November, and Son is clearly paving the way to try again.

"Ladies and gentlemen, this is Masa from SoftBank of Japan, and he’s just agreed to invest $50 billion in the United States and 50,000 jobs," Trump said after the meeting.

"He would never do this had we not won the election!" Trump later Tweeted.

The problem is that since Softbank's last attempt, T-Mobile has become notably more successful with a higher stock value, meaning that Sprint would have to pay significantly more money to seal a deal. Sprint however has been eliminating employees and cutting corners to attempt to trim $2.5 billion annually from the company's budget, making it an unlikely channel for the hirings.

Historically, such mergers don't create jobs as often as they result in the elimination of redundant positions. That said, Softbank also owns ARM, and may have promised to bring some manufacturing jobs to the States in exchange for subsidies or tax cuts. Son also claimed after the meeting some of the jobs could be created by a Softbank investment "in startup companies."

Whether these jobs or investments actually materialize is being met with skepticism by those that claim that this "new" pledge was already in line with Softbank's existing investment plans. The $100 billion fund in conjunction with Saudi Arabia was actually announced in October by Softbank, Son at the time saying the funds would make SoftBank the "biggest investor in the technology sector." But there's nothing in the announcement to suggest the investments are US specific.

Again, these investment plans were made before Trump was even President. In short, Son appears to be letting Trump claim this old plan is somehow new and a product of the Trump election -- in the hopes it will net the Japanese billionaire a favorable M&A regulatory environment for another shot at his dream merger.

Trump was notably anti-telecom merger on the campaign trail, promising he'd block AT&T's $100 million acquisition and work to break up the already merged Comcast/NBC Universal merger. However, Trump's top three telecom advisors all have close ties to large telecom providers, and all vocally support significantly less regulatory oversight of the broadband and wireless sectors.