T-Mobile Could Attract Suitors Again, Deutsche Telekom Says

Updated on

T-Mobile US Inc., the wireless carrier that drew unsuccessful bids from Sprint Corp. and Iliad SA this year, remains an attractive asset for other potential suitors, according to its owner Deutsche Telekom AG.

Companies that could seek to control the fourth-largest U.S. mobile-phone company include Comcast Corp., America Movil SAB and Dish Network Corp., Deutsche Telekom Chief Executive Officer Timotheus Hoettges said in an interview yesterday. The German carrier isn’t talking to the companies, he said.

Japanese billionaire Masayoshi Son, who controls Sprint through SoftBank Corp., could also revive an attempt to strengthen his position in the U.S., Hoettges said. Providers of software and other services over the Internet may also look for network infrastructure in the U.S., he said.

“Does that mean that we have to do a fast sale or something like that? Not at all,” Hoettges, 52, said yesterday during an investor conference organized by Morgan Stanley in Barcelona. “It’s a growth stock at this point in time and there are optionalities in the market.”

Representatives for Dish, T-Mobile and Comcast declined to comment. A press official for Mexico City-based America movil didn’t respond to a request for comment.

T-Mobile shares have held up since Iliad founder Xavier Niel’s pursuit was snubbed last month for a second time by Deutsche Telekom, while Sprint has slumped about 20 percent. Bellevue, Washington-based T-Mobile has raised its forecast for subscriber additions, while Sprint has announced 2,000 job cuts.

Shares Recover

T-Mobile’s stock pared earlier losses yesterday of as much as 3.1 percent after Hoettges’s comment. It rose 1.4 percent to $27.84 at 1:30 p.m. in New York. Deutsche Telekom closed 0.8 percent higher at 13 euros in Frankfurt.

Comcast’s purchase of Time Warner Cable Inc. for $45.2 billion, and AT&T Inc.’s $48.5 billion takeover of DirecTV will probably win U.S. regulatory approval, Hoettges said. Such deals will probably be followed by combinations of fixed and mobile operators, he said.

There is no need for T-Mobile to enter landline services, Hoettges said.

Recalling earlier negotiations to sell T-Mobile to Sprint, Hoettges said the combination -- of the third- and fourth-largest U.S. wireless carriers to rival Verizon Wireless and AT&T -- wouldn’t have won regulatory approval.

Spectrum Auction

“That was the idea which we created together with Masa Son and SoftBank to create really the No. 1 position as we have created it in the U.K.,” Hoettges said. “This would have created huge benefits to both parties, better utilization of infrastructure, better use of spectrum, and even better market relevance from a coverage perspective. This wasn’t possible from a regulatory perspective.”

Companies including AT&T, Verizon, T-Mobile and Dish are now vying for U.S. airwaves in an auction where bids have exceeded $24 billion. Dish Chairman Charlie Ergen has told Deutsche Telekom that he may be interested in a deal for T-Mobile when the auction is complete, people familiar with the matter said in September.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE