T-Mobile USA IPO or spin-off being considered

Deutsche Telekom is reportedly considering an IPO or spin-off of the T-Mobile USA business, according to Reuters. T-Mobile is a distant fourth in the U.S. mobile carrier sector. The Wall Street Journal states Duetsche Telekom has recently been in contact with several banks, including Deutsche Bank, regarding underwriting an IPO for T-Mobile USA.

Although T-Mobile USA has aggressively priced service plans, the carrier still lost 77,000 customers in the third quarter of 2009. Reported to have more than 33 million customers in the United States, T-Mobile still trails AT&T, Verizon, and Sprint Nextel. Analysts' valuation of T-Mobile USA varies greatly, ranging from $14 billion for the entire unit to approximately $6.9 billion for 20 percent of the company.

In the event of a complete spin-off, T-Mobile USA could possibly cut prices further to maintain a competitive edge in the wireless market. Odds are AT&T and Verizon, each holding about one third of the U.S. market, will not acquire the struggling company, as regulators most likely would not approve a deal.

It is anticipated Deutsche Telekom, T-Mobile USA's parent company, will make a decision by the end of the year.

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11 Comments

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Well, I can hardly judge T-Mobile US, but T-Mobile Germany is IMHO the best carrier around.
I love their service, everything is excellent, from costumer care, free hotlines (if you've not got prepaid, obv), few dropped calls, good plans, ...
It truely beats Vodafone and BASE/e-plus or O2 are nothing to seriously talk about if you ask me.
let alone that latter two are E networks, yuck...

Maybe when T-Mobile does go on its own. Google could move in on it getting a big
chunk of the stocks. Google needs a place to push their phones.

Well, for those of you who are worried about the T-Mobile being taken over by AT&T, here's a lil history for you all.

When ATT took over Cingular, the FCC said that Cingular (who had a really great coverage) would have turn over its network to T-Mobile. ATT used its old cell tower and that's the reason why it sucks.

However, if ATT does take over T-Mobile, it's going to take over Cingular (basically) and I'm sure we're gonna have great coverage after that.

Talking about monopoly, I don't really know. I don't think FCC would allow that.

CronicHazel said,
not where I live D:

It's ok, no reason to argue with him... I just write comments like that off to "I was high". Otherwise, they might just look silly.

On the flip side, I'm sure TMO is working on a 4G upgrade like the other major carriers, so if Google could get a stake in that, it might be worthwhile.