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.
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.
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.
T-Mobile USA Inc., the fourth- largest U.S. wireless carrier, named John Legere as chief executive officer, turning to a phone-industry veteran to reinvigorate growth and challenge Verizon Wireless and AT&T Inc.
Deutsche Telekom AG’s T-Mobile USA agreed to sell the rights to operate 7,200 cellular towers to Crown Castle International Corp. for $2.4 billion, providing cash to invest in the carrier’s U.S. wireless network.