Industry analysts say that, given its 53% stake in the business, that Deutsche Telekom’s move for full ownership of T-Mobile US is less about acquiring control and more about simplifying structure and addressing valuation
In sum – what to know:
Valuation focus – Deal aimed at simplifying structure and improving market positioning rather than gaining control.
Strategic reliance – T-Mobile US drives most of Deutsche Telekom’s revenue and growth momentum.
Regulatory risk – Full foreign ownership of a U.S. telco could face political and regulatory resistance.
A potential full combination between Deutsche Telekom and T-Mobile US would be driven more by structural and financial considerations than by control, according to analysts, despite its strategic importance to the German operator.
“Given that Deutsche Telekom already holds a 53% stake in T-Mobile US, a move to full ownership would be less about acquiring control and more about simplifying the structure and addressing valuation. This could result in clearer investor exposure and stronger positioning across both U.S. and European capital markets, potentially including listings in both the EU and the U.S., while also expanding the scope for future M&A activity,” Diana Gorelik, principal analyst at Omdia, told RCR Wireless News.
“At the same time, full ownership would remove minority shareholder constraints and enable more streamlined governance and capital allocation. A full combination could also enhance financial flexibility, supporting network investment on both sides of the Atlantic,” Gorelik added.
The importance of T-Mobile US within Deutsche Telekom’s portfolio has grown significantly in recent years, strengthening the strategic rationale behind a full combination.
“The proposed deal reflects the strategic importance of T-Mobile to Deutsche Telekom, which has steadily been building its stake in the U.S. carrier in recent years,” said Kester Mann, director of consumer and connectivity at CCS Insight. “T-Mobile US accounts for close to two-thirds of the group’s revenue and continues to drive its financial performance.”
“It has enjoyed a remarkable recent turnaround in fortunes, evolving from taking a market disruptor mind-set to that of a market leader. Its network improvements, in particular, are placing serious pressure on the once-dominant AT&T and Verizon,” Mann told RCR Wireless News.
At the same time, the proposed structure could introduce regulatory complexity, particularly in the United States. “Deutsche Telekom owns 53% of T-Mobile US today and the potential merger would mean that the German telco will own 100%. This means that T-Mobile US would be owned by a foreign entity, German in this case,” said Dimitris Mavrakis, senior research director at ABI Research.
“In my opinion, foreign ownership of a U.S. national telco will be met with some resistance, as networks are recognized as national strategic assets,” said Mavrakis
Mavrakis noted that the combination could bring operational benefits, particularly in procurement and knowledge sharing across regions, although its broader market impact may be limited.
“One of the key strategic benefits is centralized infrastructure procurement for its networks, bringing benefits to both its existing European network assets as well as T-Mobile US, both of which are considerable operations. There may also be more communication between U.S. and EU subsidiaries, sharing knowledge and technology expertise,” Mavrakis added.
“Finally, I don’t believe the merger would affect the global market, as there are many conglomerates or even single telcos such as China Mobile larger than the proposed combination of the two telcos,” he added.
Earlier this week, Bloomberg reported that Deutsche Telekom was considering merging its business with T-Mobile US, adding that the newly created entity could seek a separate listing in the US and Europe if the transaction goes ahead.
The report also stated that discussions are in the preliminary stages and would likely require political support in both Germany and the US to move forward.
The German carrier had regained its majority stake in T-Mobile US back in 2023. The telco has had a stake in the U:S operator since 2001.
