Update of the status of refinancing associated with Vodafone K.K. acquisition
BB Mobile Corp. (head office: Minato-ku, Tokyo; Representative: Masayoshi Son; hereinafter “BBM”) and Vodafone K.K. (head office: Minato-ku, Tokyo; Representative: Masayoshi Son; hereinafter “SBM” (Vodafone K.K. will change its trade name to SOFTBANK MOBILE Corp. as of Oct 1, 2006.)), which are wholly-owned subsidiaries of SOFTBANK CORP. (hereinafter “SOFTBANK”), entered into a bridged facility agreement of 1.28 trillion yen in total with 17 financial institutions on April 27, 2006 to finance acquisition of SBM. BBM has a short-term loan based on this agreement and decided to adopt a financing method of whole business securitization (WBS * ) as a result of examining refinancing of the relevant loan in order to shift to a permanent loan and to achieve diversification. Repayment with greater assurance will be realized based on cashflow to be generated by mobile communications business through adopting this method. This will bring a higher rating that leads to reduction in financing cost compared with usual loans.
The outline of the relevant refinancing scheme is as stated as below. When details are finalized, updated information will be promptly announced.
| 1. Refinancing scheme | Financing through securitization of mobile communications business (WBS) |
|---|---|
| 2. Debtor | SOFTBANK MOBILE Corp. |
| 3. Planned aggregate principle amount |
1,450 billion yen in total
|
| 4. Maximum borrowing period |
|
| 5. Rating | Planned to acquire ratings from Standard & Poor’s, Moody’s and Japan Credit Rating Agency, Ltd. (JCR) |
| 6. Participating institutions (planned) | Citibank N.A. Tokyo Branch, Deutsche Securities Inc., Mizuho Corporate Bank, Ltd., and other financial institutions |
| 7. Financial covenants | Covenants set on business, financial performance and other relative matters. |
| 8. Pledged asset | All assets of SBM in principle (including BBM shares held by Mobiletech Corporation, SOFTBANK’s wholly-owned subsidiary, and SBM shares held by BBM) |
| 9. Signing date | Planned to be around mid-November 2006 |
| 10. Implementation date | Planned to be around late November 2006 |
| 11. Purpose for funds | Repayment of short-term borrowings based on the bridged facility agreement and others. |
The conditions stated above are as of today and there may be some changes subject to the situation going forward. Also, impacts on financial results for the fiscal year ending March 2007 by the relevant refinancing are not confirmed yet as of today. When they are confirmed, updated information will be promptly provided.
- * WBS: Whole Business Securitization. One of structured financing schemes, which securitizes a business taking cash flow to be generated by the business as an endorsing asset to ensure repayment with greater assurance.
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