Deutsche Telekom Pondering IPO for T-Mobile USA

Further rumours about the future of T-Mobile's US division have emerged after it was reported that the company is exploring options for a stock market listing, or spin-off from its parent company.

Citing the usual people familiar with the matter, the Wall Street Journal said that the move is part of a plan to jump-start the carrier and assuage disenchanted shareholders.

T-Mobile's parent, Germany's Deutsche Telekom, has recently held discussions with a number of banks about underwriting an IPO for the unit, according to people familiar with the matter. Other options under consideration, these people said, include a partial spinoff of the business, which would carve it into a separate entity with its own balance sheet.

Deutsche Telekom declined to comment on the article.

There have been persistent rumours over the past couple of years that the German parent would seek to dispose of its US arm in some form or other. Recent talk of a merger with Clearwire and Sprint died off when Clearwire was able to raise the necessary funding for its own network independently.

A stock market floatation would enable T-Mobile to raise the funds to boost its network quality, without Deutsche Telekom ceding management control. Such a move would also make it easier for T-Mobile to seek acquisitions of smaller carriers, which would currently hit political difficulties due to the German government's shareholding - 15% direct; 17% via state owned banks - in Deutsche Telekom.