SoftBank Corp. (TSE: 9984) will acquire about 70 percent of Sprint Nextel Corp. (NYSE: S) for $20.1 billion.

The payment consists of $12.1 billion that will be distributed to stockholders and $8 billion in capital for Sprint’s balance sheet.

Through the deal, about 55 percent of current Sprint shares will be exchanged for $7.30 per share in cash. On Oct. 12, Sprint’s stock closed at $5.73 per share.

Tokyo-based SoftBank sells mobile phones and phone services. Sprint offers wireless and wireline communications services.

The transaction is still subject to regulatory approval and stockholder approval. SoftBank and Overland Park, Kan.-based Sprint expect the deal will close in mid-2013. This is the largest-ever overseas acquisition by a Japanese company.

The transaction would give Sprint more cash as it competes with Verizon Wireless, AT&T and T-Mobile, which announced a plan to merge with Metro PCS Communications Inc. (NYSE: PCS) in October.

Last year, AT&T proposed to buy T-Mobile for $39 billion, but the deal was stopped by regulators who argued it would reduce competition, limit consumers’ choices in wireless providers and raise prices for mobile services.

The Racine Group LLC and Mizuho Securities Co. Ltd. acted as SoftBank’s legal advisers. Mizuho Corporate Bank Ltd., Sumitomo Mitsui Banking Corp. the Bank of Tokyo-Mitsubishi UFJ Ltd and Deutsche Bank AG acted as SoftBank’s arrangers. Deutsche Bank also provided financial advice. Morrison & Foerster LLP, Mori Hamada & Matsumoto, Dow Lohnes PLLC, Potter Anderson Corroon LLP and Foulston & Diefkin LLP acted as legal counsel to SoftBank.

Citigroup Global Markets Inc., Rothschild Inc. and UBS Investment bank acted as Sprint’s financial advisers. Skadden Arps Slate Meagher & Flom LLP handled legal matters for Sprint. The firm also represented Sprint during its objection to the AT&T, T-Mobile deal. Lawler Metzger Keeney and Logan and Polsinelli Shughart PC also served as legal counsel.

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