Shares of the prominent technology investor SoftBank Group Corp. gained more than 5% today after it revealed it would receive $7.59 billion worth of shares in the telecommunications provider T-Mobile U.S. Inc. at no additional cost.

SoftBank said in a statement it had told T-Mobile U.S. to issue 48.75 million shares in common stock, after conditions set out in its 2020 merger with Sprint Corp. were met, according to a report by Reuters.

The Japanese tech conglomerate acquired Sprint back in 2013, before selling the company to T-Mobile for $26 billion in 2020. Under the terms of that agreement, T-Mobile had agreed to issue the 48.75 million shares to SoftBank if the 45-day trailing volume-weighted average price of its stock exceeded $150 before the end of 2025. On Tuesday, T-Mobile’s stock closed at $156.83, triggering the clause.

T-Mobile confirmed in a regulatory filing that the 45-day volume-weighted price of its stock topped the threshold on Dec. 22, adding that it would “promptly” issue the additional shares to SoftBank.

The transaction means that SoftBank has effectively doubled its stake in the carrier from 3.75% to 7.46%. “This increases the proportion of listed, measurable equity in hand on SoftBank’s balance sheet, and, even better, proportions of marginable equity relative to indebtedness,” Macquarie analyst Paul Golding wrote in a client note.

SoftBank’s stock had risen by only 14% in the year to date, prior to today’s gains. At present, the group is trading at a discount of around 45.5% of the value of its total assets, Golding believes.

SoftBank Chief Executive Masayoshi Son has been an enthusiastic investor in late-stage startups, but his ambitions have been hit by some major reversals. For instance, the company was a key backer of the office-sharing firm WeWork, whose parent company We.Co was ultimately forced to file for bankruptcy.

Golding said the T-Mobile shares bump up SoftBank’s internal rate of return on its sprint investment to 25.5%. In addition, the company has also been boosted by a rally in the stock of the chipmaker Arm Ltd., which closed on Tuesday at almost 44% above its initial public offering price.

Photo: SoftBank