SOFTBANK to Acquire Cable & Wireless IDC
SOFTBANK CORP. (the “Company”) announced today that it has decided to acquire the shares of Cable & Wireless IDC (Head office: Minato-ku, Tokyo; President & CEO: Philip Green, “C&W IDC”). As a result of the acquisition, C&W IDC will become a specified subsidiary (tokutei kogaisha) of the Company.
C&W IDC is a Japanese subsidiary of Cable and Wireless plc (“C&W”), a international telecommunications company, with customers in 80 countries. In Japan, C&W IDC is the second largest international voice telecommunications company and ranks second in international data services in Japan. By acquiring C&W IDC, in terms of consolidated sales, the Company will become second largest provider of both international voice and international data telecommunications in Japan.
1. Purpose of the acquisition
Through the acquisition, the SOFTBANK Group (the "Group") will significantly strengthen its international telecommunications business. The Group will seek to become the “number 1 broadband company” that provides comprehensive communication services including voice, data and internet connections to corporate clients as well as retail customers.
2. Effect of the transaction
(1) C&W IDC has high quality corporate customer base with small to medium sized companies, large companies and multinational companies. The acquisition will significantly strengthen our corporate business.
(2) C&W IDC has own "MYLINE" (pre-registered) customer base that will expand the customer base of the Company’s fixed line telecommunication business. At the same time, the acquisition will allow the Company to strengthen the marketing to corporate customers and allow diversification of marketing channels to acquire new customers.
(3) C&W IDC has the third largest market share in the hosting business. By integrating all Group hosting businesses, along with C&W IDC’s, the Company will be able to realize cost reductions as well as gain new customers through synergy effects.
(4) The Group will significantly strengthen its work forces especially in the areas of corporate sales and engineers.
(5) With their cost reductions plan, the Group will improve its EBITDA and revenue base significantly.
Management service for high-performance server and internet connections to website owners.
3. Outline of the Specified Subsidiar
| (1) Corporate Name | Cable & Wireless IDC Inc. | |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (2) Representative | Philip Green, President & CEO | |||||||||||||||||||||
| (3) Head Office Address | 2-3-1 Daiba, Minato-ku, Tokyo | |||||||||||||||||||||
| (4) Date of Establishment | November 17, 1986 | |||||||||||||||||||||
| (5) Paid-in Capital | 36.2 billion yen (as of end of March 2004) | |||||||||||||||||||||
| (6) Principal Line of Business | Telecommunications | |||||||||||||||||||||
| (7) Number of Total Shares Issued | 714,435 (as of end of March 2004) | |||||||||||||||||||||
| (8) Financial Results for Recent Fiscal Years |
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4. Regarding the Seller, number of shares acquired, shareholding ratios (before and after acquisition), and acquisition cost
(1) Seller
(a)
| Corporate Name | Sable Holdings Limited (100% subsidiary of C&W, “Sable”) |
|---|---|
| Representative | Andrew Garard |
| Head Office Address | 124 Theobalds Road, London WC1X 8RX |
| Principal Line of Business | Financial holding company |
| Relationship with SOFTBANK | None |
(b)
| Corporate Name | Cable & Wireless Aspac B.V. (100% subsidiary of Sable, “Aspac”) |
|---|---|
| Representative | Andrew Garard |
| Head Office Address | Emmaplein 2-II, 1075 AW Amsterdam, Netherlands |
| Principal Line of Business | Financial holding company |
| Relationship with SOFTBANK | None |
(2) Total amount of shares before and after the acquisition of the Company
- Total number of shares and shareholding ratio before acquisition
- None (Shareholding ratio 0%)
- Total number of shares and shareholding ratio after acquisition
- Before share delivery, a debt-equity-swap (DES) for all inter-company loan held by Sable to C&W IDC is arranged.
- (a) All of new common stock which will be issued to Sable
- number of shares has not been determined
- (b) 700,039 shares held by Aspac
- Shareholding ratio before DES 97.98%
(3) Total cost of acquisition
12.3 billion yen
5. Schedule
| October 26, 2004 | Signing of the share purchase agreement |
|---|
Date of share delivery has not been decided yet.
6. Future outlook
The effect of this transaction on the consolidated financial statements of the Company is unknown as of today.
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