June 27 (Bloomberg) -- Softbank Corp., which owns Japan's third-largest mobile-phone company, plans to boost capital spending at least 11 percent this year to expand its network and catch up with bigger rivals NTT DoCoMo Inc. and KDDI Corp.

The company will raise spending to about 432.9 billion yen ($3.5 billion) in the 12 months ending March 2008, from 389.8 billion yen a year earlier, Tokyo-based Softbank said in a financial statement submitted to the Ministry of Finance on June 22. The mobile-phone unit will increase spending at least 26 percent to about 387.9 billion yen, according to the document.

Chief Executive Officer Masayoshi Son failed to meet his network expansion plans last fiscal year. By the end of March, Softbank had 29,404 base stations, which transmit mobile-phone signals, missing the company's own target and trailing DoCoMo's number of stations by 36 percent.

``The move will help Softbank overcome its weakness and catch up with rivals,'' said Mitsuru Miyazaki, an analyst at SMBC Friend Research Center Ltd. in Tokyo. ``The company will get fully ready to compete with DoCoMo and KDDI.''

The Nikkei newspaper reported Softbank's spending plans earlier today.

Softbank has said it aims to deploy 46,000 base stations by Sept. 30. DoCoMo, which plans to cut capital spending 19 percent to 750 billion yen this fiscal year, has forecast it will increase its number of stations to 56,700 by March 2008. KDDI has said it will boost investment in its wireless network by 12 percent to 370 billion yen this year.

Shares of Softbank gained 11 percent in the past six months, outstripping DoCoMo's 3.2 percent. The benchmark Nikkei 225 Stock Average rose 3.6 percent. Softbank stock fell 1.5 percent to close at 2,640 yen on the Tokyo stock exchange today.

To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net; Yoshinori Eki in Tokyo at yeki@bloomberg.net.

Last Updated: June 27, 2007 03:15 EDT