Deutsche Telekom AG shares surged the most since 2008 after the company agreed to sell its U.S. wireless unit to AT&T Inc. for $39 billion, a price that exceeded analyst expectations and allows it to slash debt.
Two months ago, Deutsche Telekom AG ’s head of the U.S. told investors in New York that its wireless unit there was “ready to turn the business around” with the “best” fast Internet network to win back customers. Yesterday, it decided to sell instead.
After spending the past year trying to salvage the doomed $39 billion sale of T-Mobile USA, parent Deutsche Telekom AG will increase network investments to make the wireless operator competitive again before a potential exit.
Deutsche Telekom AG agreed to combine its T-Mobile USA unit with MetroPCS Communications Inc., doubling down on the U.S. wireless industry after a failed effort to sell the business to AT&T Inc. last year.