Feeds

SoftBank gives Washington veto over Sprint board job

The things you do to stop spooks worrying about Huawei

The essential guide to IT transformation

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.” ®

Build a business case: developing custom apps

More from The Register

next story
Hello, police, El Reg here. Are we a bunch of terrorists now?
Do Brits risk arrest for watching beheading video nasty? We asked the fuzz
UK fuzz want PINCODES on ALL mobile phones
Met Police calls for mandatory passwords on all new mobes
Munich considers dumping Linux for ... GULP ... Windows!
Give a penguinista a hug, the Outlook's not good for open source's poster child
EU justice chief blasts Google on 'right to be forgotten'
Don't pretend it's a freedom of speech issue – interim commish
Detroit losing MILLIONS because it buys CHEAP BATTERIES – report
Man at hardware store was right: name brands DO last longer
Snowden on NSA's MonsterMind TERROR: It may trigger cyberwar
Plus: Syria's internet going down? That was a US cock-up
UK government accused of hiding TRUTH about Universal Credit fiasco
'Reset rating keeps secrets on one-dole-to-rule-them-all plan', say MPs
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
e-Borders fiasco: Brits stung for £224m after US IT giant sues UK govt
Defeat to Raytheon branded 'catastrophic result'
Yes, but what are your plans if a DRAGON attacks?
Local UK gov outs most ridiculous FoI requests...
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.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.