After meeting with Donald Trump, Japanese tech billionaire Masayoshi Son said he will invest $50 billion in the U.S. — the latest instance in which Trump appears to be conducting economic policy via ad hoc deal-making, sometimes taking credit whether he deserves it or not.
WASHINGTON — After meeting with Donald Trump on Tuesday, Japanese tech billionaire Masayoshi Son said he will invest $50 billion in the United States and would “commit” to creating 50,000 new jobs over an unspecified time period.
Son is the founder and chief executive of SoftBank, one of Japan’s largest technology outfits and owner of No. 4 U.S. mobile carrier Sprint. The pledge helps SoftBank 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 through an acquisition by Sprint of Bellevue-based T-Mobile US, the No. 3 U.S. carrier.
The Tuesday announcement by Son — who left Trump Tower after being escorted down the elevator by the president-elect, who touted the pledge before waiting reporters — is the latest instance in which Trump appears to be conducting economic policy via ad hoc deal-making, sometimes taking credit whether he deserves it or not.
Last week, the president-elect spoke at the Carrier furnace plant in Indianapolis after the company announced plans to keep 800 jobs at the plant instead of outsourcing them to Mexico. Trump quickly claimed he had saved those positions, even though the company is still shifting more than 1,000 jobs from that factory and another Indiana plant to Mexico.
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Similarly, the week after the election Trump tweeted that he had dissuaded Ford from moving a Kentucky factory to Mexico. The claim was a stretch; Ford had no plans to move the plant and had already agreed to keep producing one specific model there, although it did back away from a plan to shift production of the Lincoln MKC, a small SUV, from Louisville to Cuautitlan, Mexico.
Trump quickly took credit for Son’s commitment on Tuesday, writing on Twitter: “Masa said he would never do this had we (Trump) not won the election!”
“I just came to celebrate his new job,” Son said. “I said, ‘This is great, the U.S. will become great again.’ ”
Jan Dawson, an analyst at Jackdaw Research, said, “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 investment announced by Son will come from Softbank’s previously announced $100 billion technology fund, Bloomberg News reported, citing 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.
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.
The $50 billion 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.
Trump plans to meet with leading tech executives next week, a group that will include venture capitalist Peter Thiel — one of Trump’s few supporters in Silicon Valley, and a member of his transition team — and Cisco Systems CEO Chuck Robbins. Oracle said Co-CEO Safra Catz plans to attend the Dec. 14 meeting. Facebook, Apple and Alphabet declined to say whether company executives had been invited or would attend.
Financial details about Son’s commitment and its time frame remain unclear. Softbank did not answer emailed questions. Sprint spokesman Dave Tovar referred questions to SoftBank.
T-Mobile had no comment on the topic. But at a UBS investors conference Monday, Chief Financial Officer Braxton Carter addressed the topic of regulation broadly, according to tech news website Ars Technica. Trump’s election, he said, could lead to a “more positive” regulatory situation for the telecom industry.
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 Federal Communications Commission and Justice Department signaled they were against a theoretical merger.
Since that aborted attempt to combine Sprint and T-Mobile, 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 and AT&T, the No. 1 and No. 2 U.S. carriers, respectively.
And by offering features like free video streaming, carry-over data and low prices, T-Mobile has become the fastest-growing U.S. carrier.
Analysts have predicted that a Trump-led Justice Department and FCC would be more likely to allow telecom mergers, including a deal between Sprint and T-Mobile.
Speculation about a deal pushed Sprint shares up 1.5 percent to $8.17 Tuesday. Shares of T-Mobile US climbed 1.8 percent to $55.99.