SoftBank Group Corp. Chief Executive Officer Masayoshi Son told President-elect Donald Trump he would create 50,000 new jobs in the U.S. through a $50 billion investment in startups and new companies.
The money will come from SoftBank’s previously announced $100 billion technology fund, according to a person familiar with the matter. That investment vehicle has a $45 billion commitment from the government of Saudi Arabia and $25 billion from Tokyo-based SoftBank, which operates technology and wireless companies around the world.
The pledge helps SoftBank, which controls U.S. wireless carrier Sprint Corp., get off to a good start with Trump after failing to win the Obama administration’s backing for a plan to consolidate the mobile-phone market.
Some investments from SoftBank’s fund, which was unveiled in October, were probably destined for the U.S. anyway, given the nation’s leadership in the global technology industry. But Son hadn’t previously committed to creating a specific amount of jobs through the investment vehicle.
Trump was the one to announce the job-creation pledge, taking to Twitter after a meeting with Son Tuesday. “Masa said he would never do this had we not won the election!” the president-elect tweeted.
Son is known for making bold projections about the future. In 2010, he laid out a 300-year plan for his company that involved investing in 5,000 companies by 2040 to give his unborn successors a base to build on.
SoftBank and Saudi Arabia’s Public Investment Fund unveiled their new venture weeks before the Nov. 8 presidential election. The two have been talking to other investors for the $30 billion they need to reach their $100 billion goal. When plans for the fund were first announced, Son said that he planned on being the biggest investor in technology over the next decade.
SoftBank’s U.S. unit, No. 4 U.S. wireless operator Sprint, rose 1.5 percent at $8.17 at the close. T-Mobile US Inc., which has long been mentioned as a possible merger partner for Sprint, rose 1.8 percent to $55.99 on speculation Son’s pledges could aid an eventual deal.
“Getting him on board gives any future mergers a better shot at passing regulatory muster,” said Jan Dawson, an analyst at Jackdaw Research LLC. “Trump has no right to insist that SoftBank invest any amount in the U.S., but making such commitments makes Trump look good, as Carrier and Ford have already shown, which seems to be the currency he appreciates most.”
The $50 billion U.S. investment by SoftBank isn’t intended for mergers and acquisitions such as T-Mobile, said the person familiar with the matter, who asked not to be identified discussing private information.
“We were talking about it, and then I said I’d like to celebrate his presidential job” because Trump will advocate deregulation, Son, 59, told reporters following the meeting.
The president-elect has met with numerous other business leaders at Trump Tower in New York, including Marion Blakey, CEO of Rolls Royce North America Inc., and Robert Johnson, the founder of Black Entertainment Television. On Tuesday, Trump was also scheduled to meet with Exxon-Mobil Corp. CEO Rex Tillerson, who’s said to be under consideration for secretary of state.
Son in the U.S.
Son made his fortune from investments in Japan and China, but has had a mixed record in the U.S. SoftBank bought control of Sprint in 2013 only to see it lose ground to rivals including T-Mobile. Son considered buying T-Mobile a year later, before abandoning the effort when officials at the U.S. Federal Communications Commission and Justice Department signaled they were against a theoretical merger.
Since that aborted attempt to combine Sprint and T-Mobile two years ago, the companies have been on separate trajectories. While Sprint has had to address financing by mortgaging assets and cutting costs to stay solvent, T-Mobile has sharpened its image as the underdog challenger to Verizon Communications Inc. and AT&T Inc., the No. 1 and No. 2 U.S. carriers, respectively. And by offering features like free video streaming, carryover data and low prices, T-Mobile has become the fastest-growing U.S. carrier.