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When Masayoshi Son announced SoftBank's bid for Sprint Nextel last October, his bondholders and shareholders swooned. Now that the Japanese telecoms group has sweetened its deal by $1.5-billion (U.S.), the stock market has barely blinked. Mr. Son has done a good job of selling his investors on his biggest and boldest acquisition yet. But they seem to be missing something, too.

Mr. Son has added $1.5-billion to his $20.1-billion previously agreed offer. It sounds like a steal compared to the $25.5-billion rival offer made by Dish Networks. Under the revised SoftBank offer, Sprint shareholders will also get an extra $4.5-billion in cash, funded from the $8-billion capital expenditure SoftBank had planned to inject into Sprint. In return, SoftBank takes 78 per cent, not 70 per cent, of Sprint's equity.

Raising its ownership makes the answer to this question even simpler: who will replace the $3-billion shortfall? Sprint certainly needs funds for its wireless network after years of being outgunned. In the decade to 2012, it spent about half as much as either Verizon or AT&T on wireless capex, according to HSBC. And as its woes deepened, that dropped to about a quarter. SoftBank says synergies found during due diligence justify the $3-billion capital cut. But Mr. Son highlighted his telecoms knowhow during the bid battle, so being more than a third out in his initial assessment of Sprint's needs is hard to swallow.

SoftBank's net debt to earnings before interest, tax, depreciation and amortisation would have risen from about 1.5 times to just over 3 after the original deal. The revised offer will add about 0.5 to that, according to Nomura. That is high, if do-able. Memories of SoftBank's painful 5 times-plus following previous deals worried its backers when the Sprint deal was first mooted. As it stands, they need not worry, unless the $3-billion is in fact as necessary as SoftBank first thought it was.

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