In a separate deal, Deutsche Telekom sold its Dutch unit T-Mobile Netherlands to a consortium of private equity houses Apax and Warburg Pincus for 5.1 billion euros ($6.05 billion).
Deutsche Telekom struck a share-swap deal with Softbank to increase its stake in U.S. unit T-Mobile and sold its Dutch unit in a major restructuring of interests that strengthens the German group’s transatlantic focus.
As a result of the two deals announced on Tuesday, Deutsche Telekom will raise its stake in T-Mobile US by 5.3 per cent to 48.4 per cent, bringing CEO Tim Hoettges closer towards his goal of securing direct majority control over the U.S. telecoms operator.
Softbank will in return receive a 4.5 per cent stake in Deutsche Telekom, establishing a direct shareholding relationship after Softbank sold its US Sprint unit to T-Mobile in a deal that closed in early 2020.
Deutsche Telekom acquired control of the Dutch business from Sweden’s Tele2 in 2018 but never considered the unit, which ranked a distant third behing market leaders KPN and Vodafone Ziggo, as a core asset.
Deutsche Telekom will invest some of its 3.8 billion euros in proceeds from the Dutch deal to raise its stake in T-Mobile US. Sweden’s Tele2, which had retained a 25 per cent stake in T-Mobile Netherlands, also sold out.