Bidding War

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With Two Offers For T-Mobile USA, Deutsche Telekom Might Finally Unload a Troubled Subsidiary

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A rival offer by Sprint may fail due to competition concerns.
  • Why it matters

    Why it matters

    A rival bid to buy T-Mobile USA is raising the chances for its parent company Deutsche Telekom to divest its troubled subsidiary. A deal could also bring down prices on the U.S. wireless market.

  • Facts

    Facts

    • French firm Iliad offers $15 billion for 56.6 percent of T-Mobile USA.
    • Japanese-owned Sprint is said to have offered $32 billion for the whole of T-Mobile USA.
    • In 2011, a planned T-Mobile USA sale to AT&T for $39 billion failed over anti-trust concerns
  • Audio

    Audio

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A $15 billion (€11.2) offer for a majority stake in T-Mobile USA, which is also being pursued by Japanese-owned wireless operator Sprint, could finally enable German telecoms group Deutsche Telekom to divest its U.S. subsidiary.

Despite skepticism about the bid by French firm Iliad, which is controlled by billionaire Xavier Niel, the competing offer could speed up sales talks between Sprint and T-Mobile, and offers an alternative if a deal with Sprint were to fail.

Deutsche Telekom is keen to leave the U.S. market. T-Mobile has struggled in the United States, where larger rivals Verizon Wireless and AT&T have benefitted from closer relationships to domestic smartphone makers Apple and Google, which owns the Android operating system.

In 2012, T-Mobile USA had a $7.3 billion loss, after a $4.7 billion loss in 2011. Last year, it reported a $35 million profit.

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