Deutsche Telekom focuses on internet buyout; scotches US mobile sale rumours

27 Apr 2005

Deutsche Telekom’s chief executive officer Kai-Uwe Ricke said yesterday that completing the purchase of the remainder of its internet unit that it does not already own is a ‘top priority’ for the group. Telekom holds a 90% stake in T-Online International and wants to complete a EUR2.9 billion buyout this year to help stop a two-year decline in fixed line sales. The purchasing plan has sparked complaints from investor groups representing T-Online’s minority shareholders which claim the offer undervalues the ISP, the largest in Europe. Mr Ricke also confirmed Deutsche Telekom’s EBITDA target for 2005 remains unchanged from a March forecast of between EUR20.7 billion and EUR21 billion, up from EUR19.4 billion in 2004.

Elsewhere, the company has rubbished rumours that it is preparing a sale of American wireless arm T-Mobile USA. Shareholders have been told that the cellco is following ‘an extremely successful growth strategy’ which will continue for the foreseeable future. Recent mergers in the US wireless sector have raised speculation about further consolidation in the industry; T-Mobile USA, bought by Telekom for USD35 billion four years ago, is the smallest of the US national operators but is its German parent’s fastest growing asset, accounting for around 35% of its wireless turnover in 2004.

Germany, United States, Deutsche Telekom (DT), T-Mobile US, T-Online