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By Ingrid Lunden

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Softbank (OTCPK:SFTBF) has confirmed the news that it is buying Sprint (S), the third-largest wireless carrier in the U.S., for $20.1 billion (¥1.571 trillion). In fact, this is turning out to be full acquisition of what Softbank is calling "New Sprint.": "As a result of the transaction SOFTBANK will own approximately 70% of the fully-diluted (as used herein, not giving effect to out-of-the-money options) shares of New Sprint (as defined below), which will own 100% of the shares of Sprint." Softbank says that the combined company will be the world's third largest in terms of revenues.

The news appears to have crashed the Sprint website. At least for now the site is only appearing in plain text and is taking time to load any updates, such as the link for the webcast (which it hastily announced at 2am Eastern time) to announce the news. That webcast is here.

Softbank's announcement lays out in some detail how the deal will work, and it confirms many of the facts from yesterday's CNBC report. Those noted that Softbank would buy $8 billion in shares from Sprint directly at $5.25 each; it would put out a tender for $12 billion of shares - this is actually going to be $12.1 billion, Softbank says - from shareholders at $7.30 a share (Sprint's last trade on Friday was for $5.73/share).

Part of that $8 billion will include a $3.1 billion convertible bond, Softbank says.

The heads of Softbank and Sprint are currently holding a press conference in Japan covering the news. So far, Softbank's CEO Masayoshi Son has made a big argument for synergies between the two companies: namely, they are both developing LTE on the same frequency, which helps with economies of scale. Now Dan Hesse, Sprint's CEO, is talking about how Sprint's number-three position in the market. "It's number one in terms of revenue and ARPU growth," he's noted.

"This is pro-competitive and pro-consumer" because it helps fight the "AT&T and Verizon duopoly," Hesse said. He also points out that in fact there is another synergy between the two. "When we look at what Softbank has accomplished as the number-three carrier in Japan, we can learn something from that."

Hesse will remain the CEO of "New Sprint," the companies say.

Hesse is also making a big play in terms of how Sprint is looking forward, and trying to put a lot of its legacy business (that includes its push-to-talk IDEN network, and that WiMax) behind it. "We are entering an investment phase at Sprint," he said. Network Vision, its massive upgrade plan, should be completed by 2014, and Softbank in its announcement on the deal notes that its $8 billion direct share purchase will help Sprint complete that strategy (largely in the form of that $3.1 billion convertible bond).

Termination fees. Softbank and Sprint have detailed what the termination fees may be for this deal if it doesn't go ahead either because Softbank doesn't get financing, or if Sprint has a bigger offer, or if shareholders do not approve the deal. Those fees are as follows: Softbank must pay Sprint a termination fee of $600 million if the merger does not close because SOFTBANK does not obtain financing. Sprint must pay Softbank a termination fee of $600 million if the merger does not close because Sprint accepts a superior offer by a third party. Sprint must pay up to $75 million of Softbank's expenses if Sprint's shareholders do not approve the transaction at their shareholder meeting.

The idea of another bidder swooping into the process should not be under-estimated. Deutsche Telekom (OTCPK:DTEGF), owner of T-Mobile USA (which itself had an M&A acquisition stumble when its AT&T (T) merger was blocked by regulators earlier this year) is another carrier whose name has been floated in connection with Sprint. Both Softbank and DT are apparently gunning for MetroPCS (PCS), a smaller carrier, both for spectrum and subscribers. Whether that resolves in two international carriers each owning more assets, or one taking all the chips, still remains to be seen.

More to come. Full announcement below.

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Source: Softbank Confirms It Is Buying 70% Of Sprint For $20.1 Billion