SoftBank Corp is buying a 57% stake in U.S distribution giant Brightstar Corp for $1.26 billion in a move which will make Brightstar a major force in the smartphone distribution market.
Japanese telecoms company SoftBank, which owns 80% U.S. mobile operator Sprint Corp, said that under the agreement its ownership of Brightstar would increase to 70% over the next five years.
Brightstar founder and CEO Marcelo Claure will initially retain 43 percent ownership in the company but his share will decline as SoftBank increases its stake.
The move will see Brightstar become a buyer of an estimated $20 billion worth of mobile equipment and services per year by combining the buying power of Brightstar's customers in 50 countries with that of SoftBank's various telecom affiliates.
SoftBank, which values Brightstar at $2.2 billion, said the move allows it to buy phones in bigger volumes and create efficiencies and savings through economies of scale.
Under the agreement, Brightstar will become the exclusive provider of handsets to certain SoftBank affiliates.
Brightstar generated earnings before interest, taxes, depreciation and amortization of about $260 million on revenues of more than $7 billion for the 12 months ended June 2013, the companies said.
It is unclear if Softbank's acquisition of a 57% stake will impact on Brightstar's planned purchase of 20:20 Mobile in the UK.