TOKYO-The Financial Times reported German telecommunications giant Deutsche Telekom AG is unlikely to sell off its T-Mobile USA Inc. division when it announces its debt-reduction plans next week due to the delay in reaping revenue benefits in a timely fashion and DT believing it can reach its debt reduction goals without the sale of one of its fastest-growing operations.
“Even if a deal were to be announced next week, which is highly unlikely, it could not close before the end of next year and would therefor be irrelevant from a debt-reduction point of view,” an insider told the Financial Times.
The insider covered his prediction by noting this did not mean a deal would not happen.
DT has said it wants to cut its debt level from its current $64 billion to around $50 billion by the end of next year. The company bought what was then VoiceStream Wireless Corp. last year for $30 billion, though with the dramatic downturn in the telecommunications market, financial analysts have said the company is now worth only half its purchase price.
DT has reportedly been in talks with both AT&T Wireless Services Inc. and Cingular Wireless L.L.C. about a possible sale or partnership of its U.S. wireless business.
