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Sprint Confirms Talks With SoftBank Over “Substantial Investment”

Sprint Nextel confirmed Thursday that it is in talks with Japan’s SoftBank about a possible deal.

The No. 3 U.S. wireless carrier said the discussions are about a “substantial investment by SoftBank,” but offered few other details.

“Although there can be no assurances that these discussions will result in any transaction or on what terms any transaction may occur, such a transaction could involve a change of control of Sprint,” Sprint said in a statement. “Sprint does not intend to comment further unless and until an agreement is reached.”

The Wall Street Journal and other media reported earlier Thursday that the two companies were in talks.

Sprint shares have risen following reports of the talks, but Bernstein analyst Craig Moffett said there are too many unknowns about a deal, including the size and value of the investment, whether it is an all-cash deal, and whether SoftBank will be assuming any of Sprint’s debt.

“With all that said, it is highly (highly) speculative to assign any valuation to the offer,” Moffett said in a research note.

Investors seemed willing to bid up Sprint shares, though, with the stock changing hands in morning trading at $5.97, up 93 cents, or more than 18 percent.

Sprint’s talks with SoftBank follow a somewhat similar pattern to last week’s events, which saw Deutsche Telekom confirm its talks with MetroPCS. Those two companies announced a deal the next day, though it isn’t clear whether Sprint’s talks with SoftBank are that far along.

It was reported that Sprint was mulling its own renewed bid for MetroPCS. Sprint had been looking at MetroPCS earlier this year, but never got board approval for a deal.

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