Deutsche Telekom Slides on Dividend Cut Report: Frankfurt Mover
Deutsche Telekom AG (DTE), Germany’s largest phone company, slumped in Frankfurt trading after Handelsblatt reported that the board may consider sacrificing some of the dividend after next year to invest in faster network technology and new products.
The stock dropped as much as 4.2 percent to 8.52 euros, the lowest level since July 10, according to Bloomberg data. Deutsche Telekom traded at 8.61 euros as of 12:32 p.m. Trading had surged to more than 140 percent of the average volume in the past three months, according to data compiled by Bloomberg.
Deutsche Telekom, based in Bonn, has been grappling with faltering demand in European markets amid the sovereign-debt crisis and customer losses at its U.S. unit after a botched merger with AT&T Inc. (T) last year. The former German monopoly in August pledged to pay a dividend of at least 70 euro cents (90 cents) for 2012, following payout reductions by competitors Telefonica SA (TEF) and Royal KPN NV.
Andreas Leigers, a Deutsche Telekom spokesman, called the report, which cited unidentified supervisory-board members, “speculation.” The phone operator hasn’t indicated how the dividend will develop after 2012, Leigers said by phone today.
Deutsche Telekom is predicted to leave the dividend at 70 cents through 2014 and increase it to 72 cents in 2015, according to data compiled by Bloomberg.
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