Deutsche Telekom rumored to be eyeing T-Mobile USA spinoff

Chris Ziegler
C. Ziegler|02.05.10

Sponsored Links

Deutsche Telekom rumored to be eyeing T-Mobile USA spinoff
Not a week goes by that we don't hear of investor pressure on Deutsche Telekom to strengthen its financials and offload underperforming units -- T-Mobile USA included -- and the American outpost is back in the spotlight this evening coming off a report out of The Wall Street Journal that a spinoff might indeed be in the works. According to our favorite "people familiar with the matter," DT has reached out to a few banks with the goal of raising enough capital for T-Mobile through an IPO that it'd be able to continue to fund its network build-out, something that's going to become increasingly critical as it fends off 7.2Mbps HSPA and 4G competition from all of its national competitors. There are a few scenarios allegedly being discussed, ranging from a full-on excision of T-Mobile from its corporate parent to a merger with another US wireless firm -- but the plan gaining most traction internally is said to involve selling around 20 percent of the carrier to investors while hanging onto the rest, a situation that would get the underperforming unit's financials off DT's books. Ultimately, whatever comes of this probably won't happen for a few months while the options get mulled, but considering what went down in the UK, this certainly seems plausible.
All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.
Popular on Engadget