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T-Mobile could spin off or sell U.S. division

Friday, February 5th, 2010

Telecommunication cost allocation decision makers read the news that T-Mobile USA could see an IPO or spin off in the near future with considerable interest, according to the Wall Street Journal.

The Journal reports that "T-Mobile’s parent, German giant Deutsche Telekom AG, has recently held discussions with a number of banks, including Deutsche Bank AG, about underwriting an IPO for the unit, according to people familiar with the matter."

Another possibility, according to the Journal report, is that the company could be spun off into its own separate corporation, complete with its own balance sheet and managerial independence from the parent company. T-Mobile USA could also be purchased by a competitor, but the Journal describes this possibility as "less likely."

Experts say that T-Mobile has long been mired in fourth place among the major U.S. wireless network providers, and the company’s services have – deservedly or undeservedly – acquired the reputation for being unreliable and spotty compared to its bigger competitors. The network did score a relatively significant coup with the announcement last month that it was the exclusive U.S. network provider for Google’s Nexus One smartphone.ADNFCR-2628-ID-19601590-ADNFCR

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