According to people familiar with the matter, Deutsche Telekom is considering a tie-up with T-Mobile US Inc. A comprehensive merger, a move that would create a multinational telecoms group, is expected to be the largest public merger and acquisition in history. People familiar with the matter said that Deutsche Telekom currently holds about 53% of T-Mobile shares and is its largest shareholder.
The company is discussing setting up a new holding company that would make stock offers for Deutsche Telekom and T-Mobile. The people spoke on condition of anonymity because the information is not public.
The potential transaction would form a more streamlined single corporate structure that would unify the operations of Deutsche Telekom and T-Mobile and be jointly owned by existing shareholders of both companies. Some people familiar with the matter said the combined entity could be listed on major U.S. and European exchanges, but details were still being worked out.
Sources said the relevant discussions are still at a preliminary stage, and any deal will need to gain political support and the specific plans may still change. The two companies have discussed increasing cooperation on and off for years, but there is still uncertainty about whether it will move forward this time.
A Deutsche Telekom spokesperson said in an emailed statement: "As a rule, Deutsche Telekom and T-Mobile US do not comment on market speculation about the company's business activities, and we do not have more specific information to respond." A T-Mobile spokesperson declined to comment.