SoftBank’s Boss Bet $22 Billion on Sprint. It Was a Slog.

By Phred Dvorak, Wall Street Journal

For Japanese billionaire Masayoshi Son, a U.S. judge’s recent decision to approve a merger between Sprint Corp. and rival T-Mobile US Inc. is long-awaited payback on his $22 billion investment. But it is far from the triumph the maverick investor was seeking when he announced he was taking control of Sprint in 2012.

At that time, the SoftBank Group Corp. boss was running Japan’s third-ranked mobile-phone company. Combined with Sprint, he gleefully told the audience at a Tokyo press conference, SoftBank was the No. 3 mobile carrier by revenue—not just in Japan, but in the world. Privately, Mr. Son was already plotting to join Sprint with T-Mobile and grow even bigger.

“I aim high,” Mr. Son told the crowd. “I’m going to be No. 1 in the world.”

Nearly eight years later, Sprint’s sales are sagging, the company is losing money and market share, and it has said it needs to combine with T-Mobile because it is falling behind in the industry. In Tokyo last week, Mr. Son—who last year spun off SoftBank’s Japanese cellphone business and is now controlling the world’s biggest tech-investment fund—sang a different tune.

The Sprint-T-Mobile merger “has been a huge struggle,” Mr. Son said Wednesday, the day after the U.S. court decision. “But at least we’ve made plenty of money on the investment.”

That turnaround shows just how far Mr. Son has retreated from his first ambitious goals for Sprint. SoftBank referred to previous comments from Mr. Son about Sprint’s merger with T-Mobile.

For years, Mr. Son fought to engineer a Sprint-T-Mobile merger, which he saw as key to gaining the scale needed to challenge U.S. mobile giants Verizon Communications Inc. and AT&T Inc. He abandoned the attempt first in 2014 in the face of resistance from U.S. antitrust regulators, then again in 2017 when he balked at giving up control of the merged company to T-Mobile parent Deutsche Telekom AG .

Misjudging the U.S. regulatory environment was “one of the biggest mistakes in my life,” Mr. Son told The Wall Street Journal in a 2015 interview. 

During the early years of SoftBank’s ownership, Mr. Son threw himself into the effort to fix Sprint’s ailing network and galvanize its operations. He set up new SoftBank headquarters in California to better liaise with Sprint brass in Kansas and floated plans to ship 1,000 employees from Japan to help out. He immersed himself in the technical details of U.S. cell sites and replaced Sprint’s CEO.

But increasingly, Mr. Son was frustrated by Sprint’s continued subscriber losses and attracted by the opportunity to create what became SoftBank’s $100 billion Vision Fund. In 2018, Mr. Son agreed to give up control of Sprint as a condition of the merger.

“I finally accepted that a little compromise was OK in light of the huge benefits that would come from the merger,” Mr. Son said in 2018, explaining his decision. “I grew up.”

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