- Macquarie Capital thinks SoftBank (OTCPK:SFTBY) founder Masayoshi Son is taking a more active role at beleaguered Sprint (NYSE:S), which could help the company get on keel in an industry sea roiled by consolidation tremors.
- "We sense that the (network upgrade) plan has been thoroughly vetted by SoftBank CEO Son-san, who has personally taken a more active day-to-day role in Sprint's network deployment, cost cutting and financing activities," says Kevin Smithen, "which, in our opinion, has resulted in recent progress on churn and improved network performance in several markets."
- Son has stayed out of the spotlight after failing to urge a Sprint/T-Mobile merger. But he's not the only one, Smithen notes, who can aid a turnaround: Nikesh Arora, now Softbank president and Son heir apparent, has revenue and ops experience that can help as Sprint faces a cash problem.
- While a meeting with Sprint execs didn't get into specifics, Smithen writes: "We came away feeling that much has been happening behind the scenes and that Sprint's network plan is near finalization and a rapid, phased deployment over the next 18 to 24 months ... In our opinion, Sprint can complete its network densification at just around $5 billion per year due to very large price reductions from equipment vendors. ... We believe that Sprint would sell 20 to 40MHz of 2.5 GHz (spectrum) if it got a good offer."
- Citigroup's Michael Rollins estimated Sprint would burn free cash of $6.1B in 2015, and yet SoftBank has not quite $100B in debt of its own getting in the way of helping out.