Softbank is buying Sprint, the third largest carrier in the U.S. and even the fifth largest company.
Sprint, the third-largest carrier, has been running at a huge loss for the past five years.
Normally, one would not buy a company that has been running in the red for five years.
Why would SoftBank acquire Sprint?
Because SoftBank has a past success story with Vodafone in Japan.
Anyone will buy a profitable company, no matter how high the price. No matter how expensive. It is easy to buy.
It is scary to buy a company in the red. No one knows how much off-balance-sheet debt they have.
You don't even know how much off-balance-sheet debt they have. Due diligence is almost unreliable.
Why buy?
Because they have the proprietary know-how to turn a company around. Softbank has mastered this in Japan.
Vodafone, which had been a failure, was turned around with the I-phone as a weapon and sales promotion skills.
This is exactly how SoftBank entered the market through a narrow gate and accumulated know-how (improvement mechanism).
This is strong. They have acquired know-how that can be applied in any way depending on the way they do things. 。。。。
Another important point is that he is a founding owner.
There are three presidents among the top 50 Japanese companies in terms of market capitalization who are founding owners.
Softbank: Mr. Son.
Uniqlo: Mr. Yanai.
Rakuten, Mikitani.
A salaried CEO cannot make a decision on this large acquisition.
They do not want to take responsibility. In a board of directors' council system, everyone can only take risks.
The stage of growth of a company is no bigger than the size of its president.
He must be bold in his decision-making and take the company to the next big stage.
Without an insatiable appetite for growth, a company cannot exist.
Let us always be conscious of growth!
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Akira Tsuchiya