SoftBank Said to Have $65 Billion in Funds for Charter Deal

SoftBank Group has as much as $65 billion in financing lined up as Chairman Masayoshi Son weighs whether to make a formal takeover offer for Charter, according to Bloomberg, citing people familiar with the matter.

The financing arrangement is among the new details that are emerging on Son’s plan to merge Charter with SoftBank’s struggling U.S. wireless company Sprint. While Charter said in a statement last weekend that its board wasn’t interested in buying Sprint, Son’s proposal all along has been for SoftBank to acquire Charter and combine it with Sprint to create a new publicly traded company, the people said.

The funding to complete that complex transaction, from four banks, has been in place for some time, said the people, who asked not to be identified discussing private information. Charter’s board was aware of the financing when it rejected Son’s initial deal proposal, but he is contemplating whether to proceed with a formal offer anyway, perhaps with some tweaks.

Persuading Charter’s investors to do a deal could be tough. John Malone, the cable billionaire who controls about 21 percent of Charter through Liberty Broadband, agreed with the decision by Charter’s board to reject Son’s proposal, two of the people said.

A formal offer is unlikely to come this week, and Son may ultimately decide not to proceed with a bid for Charter, the people said. His plan had been for SoftBank, which owns 84 percent of Sprint, to acquire the rest of the U.S. wireless carrier for a premium, then buy Charter for cash and stock, the people said.

The board also considered $65 billion of debt to be too much for the new company to take on, one of the people said. Charter already has $63 billion of debt on its balance sheet, while Sprint is carrying $40.9 billion of its own. SoftBank is among Japan’s most indebted companies, with total debt of about $130 billion.