Deutsche Telekom stock dropped as much as 3.9% on Thursday after the Wall Street Journal reported the German telecom group is actively pursuing a full combination with T-Mobile US (TMUS).
The drop marked the steepest intraday decline for DTEGY since April 22, when Bloomberg first reported that Deutsche Telekom was exploring a potential merger structure with its American arm. The stock fell 4.8% that day.
Thursday’s report adds fresh detail to what has been a slow-burning story. Deutsche Telekom CEO Tim Höttges is personally pushing the transaction forward, according to the Journal.
T-Mobile US currently sits at the center of Deutsche Telekom’s business model. The US unit contributes almost two-thirds of the group’s total revenue, making it by far the most valuable piece of the company.
The deal faces a notable wall of resistance from T-Mobile’s minority shareholders. These investors are reportedly skeptical because a merger would give them exposure to Deutsche Telekom’s lower-margin international operations — a trade they may not be eager to make.
Getting those shareholders on board is just one piece of a complex puzzle.
Deutsche Telekom would also need the blessing of the German Federal Government, which holds a 28% stake in the company. After that, the deal would face a regulatory process that could involve security reviews in both Germany and the United States.
Höttges, who plans to retire at the end of 2028, wants the merger completed and a successor in place before he steps down.
That timeline adds some urgency. The CEO has roughly two and a half years to get a highly complex, cross-border transaction across the line.
The path hasn’t been without friction. T-Mobile’s ties to the Trump administration created political headaches in Germany. The company’s decision to drop its diversity, equity, and inclusion commitments last year drew thousands of complaint emails from German shareholders, according to the Journal.
Deutsche Telekom has not officially confirmed any merger talks. During an earnings call on May 13, Höttges said: “As a matter of principle, we do not comment on market rumors or speculations from the press regarding potential transactions.”
T-Mobile US stock moved modestly, up around 0.34% to 0.38% on the day, suggesting investors are not yet pricing in a firm deal.
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