Japan’s Softbank plans to raise about $12 billion by securitizing earnings of the cell phone unit it bought from Vodafone Group, a source close to the matter said on Tuesday, allowing it to secure funds at a lower rate than with conventional loans. Earlier this year, Softbank bought Vodafone Japan for 1.8 trillion yen ($15.4 billion) after borrowing 1.3 trillion yen in short-term bridge loans, arranged by 17 banks led by Mizuho Financial Group, Deutsche Bank and Citigroup.
Softbank, which is in the process of refinancing the short-term loan, said it was finalizing terms and expects to decide a general outline of new loans, which would have different maturities, by the end of September. The company wants to minimize interest costs, as such expenses are expected to total about 40 billion yen ($343.3 million) for the bridge loan, which lasts until March 2007, the end of the business year. Shares of Softbank, a telecommunications and Internet conglomerate, rose 3.79 percent to close at 2,190 yen on Tuesday. Continue>>