Deutsche Telekom increases its stake in T-Mobile US

Deutsche Telekom now holds 48.4% of T-Mobile US

Deutsche Telekom has increased its participation in T-Mobile US after it paid $2.4 billion to Japanese operator SoftBank Group, according to a report by Bloomberg. With this move, the German operator is closer to its goal of holding a majority of the U.S. carrier.

Deutsche Telekom now holds 48.4% of T-Mobile US after it acquired 21.2 million shares at an average price of $113 per share.

Deutsche Telekom is using part of the approximately 4 billion euros received from the recent sale of T-Mobile Netherlands to acquire the stake.

SoftBank still holds about 39.7 million shares in T-Mobile, currently worth about $5.2 billion.

The German operator previously had a 46.7% stake in T-Mobile after it accquired 45 million shares in the company in September as part of a previous deal with SoftBank.

This deal provided Deutsche Telekom with a call option to acquire up to 101 million T-Mobile shares by June 2024. In return, SoftBank received 225 million new shares in Deutsche Telekom, giving the Japanese company a 4.5% stake in the German carrier.

Last month, Deutsche Telekom and Tele2 have closed the sale of T-Mobile Netherlands. A consortium of private equity funds advised by Apax Partners LLP and Warburg Pincus LLC has acquired the company based on an agreed enterprise value of  5.1 billion euros.

In the fourth quarter and full-year of 2021, T-Mobile US reported:

-$15 billion in service revenue in the fourth quarter and a record $58.4 billion for the full year.

-Profits of $422 million in Q4 2021 and $3.0 billion for the full-year 2021.

-Postpaid net account additions of 315,000 in the fourth quarter and 1.2 million for the full year.

-Net Postpaid phone customer additions of 844,000 in the most recent quarter, and 2.9 million for the year.

-High-speed Internet net customer additions of 224,000 in Q4 and 646,000 for the year, more than the 500,000 it had targeted.

T-Mobile US reached 210 million potential customers with its midband 5G deployment this year — more than the 200 million it had targeted — and plans to cover 300 million by the end of this year.

In a previous conference call with investors, T-Mobile US’s CEO Mike Sievert said the carrier’s competitors won’t match T-Mobile US’ 5G build any time soon.

“According to their own build plan[s], it will take [AT&T and Verizon] multiple years to reach 200 million people, and they still won’t be anywhere near the depth of mid-band spectrum that we’re putting to work across our larger footprint,” Sievert said. “This demonstrates the remarkable deployment machine that we have spent years building and how hard it is to replicate.”

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