The President-elect Donald Trump took to Twitter yesterday to announce that SoftBank Group is planning a $50 billion investments in the US which will open 50,000 new jobs. Trump made the announcement after a short meeting with Masayoshi Son, the Chief Executive Officer at SoftBank. Interestingly enough, Son allegedly said that this investment would never have happened had Trump not won the US presidential election last month. In addition to new job openings, SoftBank will also be looking to invest in existing businesses. While neither Son nor Trump revealed any details of the company’s investment, latest reports suggest that the Japanese telecommunications giant is going to fuel the US economy by its $100 billion tech investment fund announced earlier this year.
In addition to being a significant boom for the US economy, this investment also sounds like the first step towards the potential merger of T-Mobile US and the SoftBank-owned Sprint. The third and fourth largest wireless carriers in the country previously discussed consolidation, but their plans were prevented by the Obama administration. Couple that with Son’s statement that SoftBank would have never made this investment had Hillary Clinton, i.e. the Democratic presidential candidate won, and it’s not unreasonable to presume that the Japanese tech giant is hoping to benefit from a more lenient Republican administration that’s scheduled to take office on January 20th.
Not surprisingly, both T-Mobile and Sprint shares rose after the announcement, with the latter hitting a new high in 2016 at $8.61 per share. As Son vaguely explained during a press conference in Trump Tower yesterday, this incoming investment is meant to be a celebration of Trump’s election win. Interestingly enough, SoftBank’s spokespeople are still refusing requests for comment, which may suggest that this deal happened spontaneously. All in all, it remains to be seen how the Japanese tech giant is looking to invest this figure and how it’s hoping to benefit from it in the future, but one thing is certain – significant changes in the US wireless industry are on the horizon. Furthermore, Sprint and T-Mobile could stand to reap considerable benefits if the incoming Trump administration relaxes industry regulations and allows them to continue their negotiations over a potential merger. However, only time will tell what that scenario will mean for consumers.