In a piece today in Bloomberg written by Scott Moritz and Jeffrey McCracken, the two pointed out the operational savings that Softbank Corp (TYO:9984) (PINK:SFTBF) expects from a Sprint Nextel Corporation (NYSE:S) merger could reach $3 billion by 2017. Softbank’s President Masayoshi Son laid out these numbers this week in a meeting with Sprint investors in New York. Softbank sees a savings of $2 billion immediately from 2014 to 2017 with the $3 billion arriving after that. This will be achieved cutting Sprint’s capital spending by 32 percent to 36 percent according to the pair.

Softbank

Sprint Nextel Corporation (NYSE:S)’s board is still mulling-over another bid by DISH Network Corp. (NASDAQ:DISH) valued at $25.5 billion compared to Softbank Corp (TYO:9984) (PINK:SFTBF)’s $20.1 billion. While that might seem like a no-brainer it’s really a bit of a mystery where Dish, the nation’s second largest satellite TV provider would come up with the financing to make the merger happen.

In addition to the financing, Sprint Nextel Corporation (NYSE:S)’s board is concerned about the debt that the merged company would be forced to accept according to the Bloomberg report. The two also reported that DISH Network Corp. (NASDAQ:DISH) is suggesting that $11 billion in savings will come from the overlap in the two company’s marketing departments and other business units. Mr. Moritz and Mr. McCracken reported that the Sprint board may not see this synergy as a reality.

Bob Toevs, a spokesman for Englewood, Colorado-based Dish, didn’t immediately respond to a request for comment, nor did Scott Sloat at Overland Park, Kansas-based Sprint.

Softbank Corp’s Synergy Numbers

Softbank Corp (TYO:9984) (PINK:SFTBF)’s synergy numbers came from nine months of diligence before they announced the deal with Sprint Nextel Corporation (NYSE:S). As a wireless carrier like Sprint, Softbank will without question provide a savings to Sprint if the two are merged. They are also bringing $8 billion to the table to bail out Sprint following the disaster that has been the Nextel acquisition in 2005.

Dish has made its offer in the interest of getting involved in wireless as the company sees it satellite TV sales waning. Sprint stock is up over 30 percent for the year as investors are clearly anticipating a bidding war that has already driven the stock higher than the price that Softbank Corp (TYO:9984) (PINK:SFTBF) has agreed to pay.

This is far from over and ValueWalk will continue to report on the merger as more information comes to light.