Feeds

SoftBank gives Washington veto over Sprint board job

The things you do to stop spooks worrying about Huawei

Application security programs and practises

Japanese company SoftBank, currently wrapping a deal to buy 70 per cent of US mobile carrier Sprint, has taken the unusual step of giving the US government veto power over one member to be elected to the board of its acquisition target.

SoftBank’s bid to take over America’s third largest operator was delayed for months while it waited for approval from 23 separate states.

That process came to a close today after the California Public Utilities Commission approved the deal. The Japanese firm still needs shareholders to approve the transaction in a 12 June vote.

In the meantime it must also satisfy a US government increasingly wary of foreign takeovers, especially in an area like telecoms with obvious national security implications.

SoftBank’s proposed deal is currently being assessed by the FCC, Justice Department, FBI and the Treasury-led Committee on Foreign Investment in the US (CFIUS), according to the Wall Street Journal.

People familiar with the matter told the paper that not only was SoftBank prepared to give the government right-of-approval on one of Sprint’s next board members, but it may also be forced to consider giving Washington approval powers on future equipment purchases.

It isn’t helping matters that one of SoftBank’s majority-owned businesses, Clearwire, uses Huawei kit.

Lawmakers branded the Shenzhen-based telecoms kit manufacturer a national security risk in a high profile report last October, and a US spending bill back in March banned certain agencies from buying any technology from firm thought to be “owned, operated or subsidised” by the Chinese government.

Although Huawei has consistently denied links to the Chinese authorities and Japan’s third largest operator has apparently already given the US its word that any Huawei kit would be removed from Clearwire post-takeover, doubts persist.

Sensing an opportunity to turn those doubts into action, US satellite biz Dish has been on the offensive this week in an attempt to sell its $25.5bn bid for Sprint to shareholders and government.

“If the news reports are accurate, and CFIUS has concerns with respect to the use of Chinese manufactured equipment on a foreign-controlled Clearwire network, then as much as $1 billion would have to be added to the cost of the proposed SoftBank-Sprint transaction,” said Dish general counsel Stanton Dodge in a canned statement.

“The question is about who should control and who will be accountable for assets – the Sprint national wireless and backbone fiber networks – that are vital to our national security.” ®

HP ProLiant Gen8: Integrated lifecycle automation

More from The Register

next story
Adam Afriyie MP: Smart meters are NOT so smart
Mega-costly gas 'n' 'leccy totting-up tech not worth it - Tory MP
'Blow it up': Plods pop round for chat with Commonwealth Games tweeter
You'd better not be talking about the council's housing plans
Arrr: Freetard-bothering Digital Economy Act tied up, thrown in the hold
Ministry of Fun confirms: Yes, we're busy doing nothing
ONE EMAIL costs mining company $300 MEEELION
Environmental activist walks free after hoax sent share price over a cliff
Help yourself to anyone's photos FOR FREE, suggests UK.gov
Copyright law reforms will keep m'learned friends busy
Apple smacked with privacy sueball over Location Services
Class action launched on behalf of 100 million iPhone owners
UK government officially adopts Open Document Format
Microsoft insurgency fails, earns snarky remark from UK digital services head
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.