Deutsche Telekom May Not Sell After All

SHARE THIS ARTICLE

Despite tentative offers for T-Mobile, Deutsche Telekom may not be interested in selling their shares of the U.S.’s fourth largest mobile carrier for at least another year. Reuters reported that Deutsche Telekom fears the sole current suitor for the U.S. firm will fail to come through with a sufficiently attractive offer. Iliad, the French telecom company, has a mid-October deadline to up their $33 a share bid for 56.6% of T-Mobile. A higher offer could still appeal to Deutsche Telekom, but the decision is a big one. Reuters explained, “The decision is a crucial one for Europe’s third-largest telecoms firm by market value, because the U.S. business, which accounts for about a third of its sales and a fifth of its core profits, has long been a drag on cash flows. An exit would dramatically alter its size and profile at a time of consolidation across the industry as companies seek to bring together fixed and mobile services. But some executives at Deutsche Telekom have begun to warm to the idea in recent weeks of now keeping T-Mobile US until after a major auction of U.S. radio spectrum is completed late next year. Under local rules, companies cannot hold deal talks ahead of spectrum sales, so a delay would allow other possible suitors such as satellite TV group Dish or cable companies now busy with their own mergers to make bids.”

Reader Interactions

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.