SoftBank reportedly set to make another pass at a Charter-Sprint union

SoftBank Masayoshi Son at Mobile World Congress 2017
SoftBank Chairman Masayoshi Son appears at Mobile World Congress 2017.

Charter Communications has no comment concerning reports that Japanese billionaire Masayoshi Son and his SoftBank Group Corp. have reportedly not taken the cable company’s “no” for an answer.

After Charter rebuffed an overture over the weekend that would essentially have the No. 2 cable company buy SoftBank’s No. 4 U.S. wireless carrier, Sprint, Bloomberg said that Son will try to buy Charter outright and combine it with Sprint. 

“Overall, our view is that Charter likely does not want to sell, but that SoftBank is one of the few companies that could put a bid in big enough to take control,” analysts at JPMorgan Chase & Co., led by Philip Cusick, said in a note to investors. “While we don’t see a deal as very likely, especially given later headlines that Charter is cool to the idea, Masa is never to be counted out as a buyer.”

RELATED: Charter shoots down Sprint bid, stands by claim that wireless business ‘has a lot challenges in front of it’

With a market capitalization of $101 billion, Charter wouldn’t be an inexpensive purchase for a company that has acquired $135 billion in debt, second only to Toyota in Japan. SoftBank has achieved sizable girth through highly leveraged financing of acquisitions like Alibaba Group Holding Ltd., for which it has achieved outsized returns, and Sprint, on which it has lost billions.  

Not all analysts support Son’s plan.

“Son is going back to his bad old days of wanting to conquer the world, just as we thought he was becoming more sensible,” Amir Anvarzadeh, head of Japanese equity sales at BGC Partners Inc. in Singapore, told Bloomberg.“It does sound as if they’re doing anything but deleveraging. They’re releveraging.”

For its part, Charter’s Tom Rutledge said last week that the wireless business is too fraught with challenges for the cable operator to want to assume owners’ economics. Charter is happy, Rutledge said, with its wholesale agreement with Verizon, and its partnership agreement with Comcast, and will soon launch its own wireless service based on those assets. 

But as Bloomberg noted, Son does have the wherewithal to buy Charter out, whether it wants to sell or not. 

Doing so would combine Charter’s more than 23 million landline broadband customers, and more than 17.1 million pay TV subscribers, with a wireless company looking for assets to compete with vertically integrated giants Verizon and AT&T.

As Bloomberg noted, Son’s plans are evolving. An offer is expected in the next few days.