Deutsche Telekom has called on Deutsche Bank advisers to study if it is possible for the telecommunications giant to buy Sprint. Sprint is the third largest telecommunications company in the United States. This possibility arises at a time when T-Mobile UK may be tying their operations with Orange to create the biggest mobile phone company in the United Kingdom.
Sprint has a market cap of $10.6 billion and Deutsche Telekom may submit a bid within the next few weeks. Deutsche Telekom has a market cap of $60.5 billion. T-Mobile U.S. continues to struggle against AT&T and Verizon Wireless in retaining customers. Both AT&T and Verizon have advanced 3G networks while T-Mobile has been slow at jumping on the bandwagon.
In order to buy out Sprint, Deutsche Telekom would need a cash injection from shareholders and the German government. The German government owns about 32% in Deutsche Telekom.