The anticipated ¥1 trillion ($6.3 billion) fee for SoftBank Group Corp. (OTC:SFTBY) from a U.S.-Japan project has been slashed by over 90% due to intervention from Tokyo officials amid growing concerns over the $550 billion joint investment plan between the U.S. and Japan.
SoftBank’s Role In The Deal
SoftBank was originally slated to earn fees from building and operating a $33 billion gas-fired power plant in Ohio. The project marks the first outcome of a trade deal in which Japan secured tariff relief from Washington in exchange for a $550 billion investment in the U.S., the Financial Times reported on Thursday.
The fee was intended to compensate it for its role as project developer, as it does not hold any equity in the power plant. The facility would be entirely financed by Japan and jointly owned by the U.S. and Japan through a special-purpose vehicle created under the trade agreement.
Despite the reduced fee, SoftBank will continue to receive payments over 15–20 years if …
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