KDDI's dream of enhancing its network and service presence through acquiring a stake in cable operator J:Com continues to be challenged as Sumitomo now plans to offer $1.4 billion to acquire an even bigger stake in the company.
Sumitomo does have one advantage in purchasing a bigger stake J:Com: established ownership. The company already owns a 27 percent piece in J:Com, and if it succeeds it would become the company's biggest shareholder. What's more, Sumitomo would also have greater control over the company's actions.
Analysts believe that Sumitomo's bid is an attempt to trump KDDI's proposed offer for J:Com. Although KDDI did lower its proposed bid for a stake in J:Com following a regulatory inquiry, it would not talk about Sumitomo's counterbid adding that its interest in J:Com is about enhancing its wireline business.
"Our aim is not to be the largest shareholder of J:Com, but just to bolster our fixed-line business," said KDDI spokesman, Keiichi Sakurai.
- Reuters has this article
- Bloomberg also has this analysis
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