Deutsche Telekom Is Considering Raising Its Stake in T-Mobile

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Deutsche Telekom AG is considering taking a bigger stake in affiliate T-Mobile, according to a person familiar with the discussions, in a sign the German carrier’s management sees more growth potential in the U.S. than at home.

Deutsche Telekom currently holds a 43.3% stake in T-Mobile US Inc. worth $73.3 billion. In 2020, it was granted the right to buy a further 101.5 million shares -- around 8% -- in the U.S. carrier currently held by SoftBank Group Corp. T-Mobile’s stock slipped 1.8% to $137.75 in New York trading Tuesday.

A spokesperson for Deutsche Telekom declined to comment. The news was first reported by Handelsblatt.

Deutsche Telekom Chief Executive Officer Tim Hoettges, who is set to address shareholders at a capital markets day on Thursday, has lobbied in vain for years for cross-border European mergers that would allow the region’s phone companies to narrow a profitability gap with their U.S. peers.

With Deutsche Telekom struggling for growth in Europe, T-Mobile has outperformed its parent company, and has taken a lead in fifth-generation mobile services outpacing rivals Verizon Communications Inc. and AT&T Inc. Its acquisition of Sprint Corp. a year ago made it the second-largest provider of wireless services in the country.

Earlier this month, T-Mobile topped earnings estimates and boosted its subscriber forecast.

SoftBank became a co-owner of T-Mobile with Deutsche Telekom after the carrier took over Sprint in a $26.5 billion merger in 2020.

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