Japanese owned telecommunications firm Softbank will acquire a 7 percent stake of US based Sprint, which specialises in communications and provides services to mobile operators.

The purchase will cost $20.1 billion with around $12 billion going to Sprint shareholders and the remaining $8.1 billion going back into the company’s books.

Softbank CEO Masayoshi Son said: "This transaction provides an excellent opportunity for Softbank to leverage its expertise in smartphones and next-generation high-speed networks”.

The investment is expected to be completed by 2013 after regulatory approval.