Deutsche Telekom, owner of T-Mobile, has called in banking advisers to study a possible multi-billion dollar bid for Sprint Nextel, the third-largest mobile phone operator in the U.S. The company’s decision to call in Deutsche Bank comes just after the agreed tie-up of its struggling T-Mobile U.K. business with Orange to create the country’s biggest mobile phone firm. Sources said Deutsche Telekom could submit a bid for Sprint, which has a market valuation of $10.6 billion, within the next few weeks, said the U.K.’s Telegraph. René Obermann, chief executive of Deutsche Telekom has pledged to reverse the fortunes of T-Mobile U.K. and T-Mobile U.S. He has said the problems in the U.S. were “part structural”, raising speculation that the company was exploring a deal. Sprint is struggling to compete against larger rivals AT&T and Vodafone’s 50 percent-owned joint venture Verizon Wireless, which have more advanced 3G networks. T-Mobile U.S. is also losing customers to small operators offering cheap deals. Combined, T-Mobile, the fourth-placed operator, and Sprint, the third biggest player, would closely challenge AT&T’s second-place spot with 78.2 million customers.
T-Mobile Owner to Bid for Sprint Nextel
Sources said Deutsche Telekom could submit a bid for Sprint within weeks.
September 14, 2009