T-Mo USA alone generates $19 billion in annual revenues. That's nothing to stick your nose up at.
The problem is that the way its setup right now the German government which owns 30% of the combined Deutsche Telekom requires huge dividend payments which prevents DT from reallocating much of that revenue back into the infrastructure of their US arm.
DT was only able to allocate $3 billion in network upgrade costs last year compared to $10 plus billion other carriers spend on their wireless only divisions.
If T-Mobile US can go public and large names can impart huge cash infusions, then the seperate entity can refarm that money into network upgrades/expansion and DT, still a majority owner, will still reap the benefits of profits.
Another option that I can see happening down the road is for Vodafone to force Verizon to buy them out and they could use that cash to buy T-Mobile USA out right. Voda is known for dumping butt loads of cash in network investments much to the dismay of their shareholders.
Of course I'd rather see a US company like Google invest a 20% ownership of T-Mobile USA but not sure if that will ever happen?
reply to YesILuvU2 This has more to do with DT raising cash so that they can invest in the network or make some acquisitions.
By doing the IPO, DT keeps control of the company and raises some serious cash that can be then pulled back into DT, used for network expansion/upgrades or acquisitions.
Smart move if they want to become a serious player in the US market.
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