Deutsche Telekom Wants to Merge With T-Mobile US

Deutsche Telekom (OTC: DTEGY), headquartered in Bonn, Germany, is proposing a full merger with Bellevue, WA-based T-Mobile US (NASDAQ: TMUS). The idea reflects the company’s strategic ambition to turn its fast-growing American subsidiary into the core of a new transatlantic telecom giant, The Wall St. Journal reported. Deutsche Telekom already owns just over 53 percent of T-Mobile, but recent reporting shows it now wants the rest, a move that could create the largest telecom merger in history, according to Euronews.

Analysts note that the U.S. business provides the majority of Deutsche Telekom’s market value and earnings momentum. A full merger would give the German company complete control over its most successful asset while preserving T-Mobile’s agility and high valuation. The combined entity could reach a valuation of $300-400 billion, becoming the world’s most valuable telecom operator with more than 200 million subscribers, U.S. News reported.

Deutsche Telekom’s idea is a new holding company structure that would fold both companies into a single, jointly listed transatlantic corporation. This structure would allow an all share transaction without requiring massive cash financing. Deutsche Telekom CEO Tim Höttges is personally driving the effort, aiming to complete the merger before his planned retirement in 2028, WSJ reported. But the company acknowledges that turning its ambition into the largest telecom merger ever will require navigating politics, regulators, and shareholder concerns on both sides of the Atlantic.

By John Celentano, Inside Towers Business Editor