T-Mobile Executives Withdraw Support for $300 Billion Deutsche Telekom Merger, Report Says

T-Mobile US executives have reportedly informed parent company Deutsche Telekom that they no longer support a proposed $300 billion merger, citing significant shareholder and regulatory opposition. The development, first reported by Semafor, casts serious doubt on the future of the transatlantic telecommunications deal.

Shareholder and Regulatory Hurdles

According to the Semafor report, which cited people familiar with the matter, the opposition from T-Mobile's management stems from two primary concerns. Several of T-Mobile's large institutional investors, who are non-controlling shareholders, have communicated that they would vote against a merger with the German parent company.

Additionally, T-Mobile executives reportedly received indications from government officials that U.S. regulators would likely impose strict conditions on the deal. These could include a guarantee that all revenue generated in the U.S. would be reinvested within the country or otherwise remain in the United States.

Market Reaction

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News of the potential collapse of the deal sent shares of both companies lower in Friday trading. Following the report, the market reaction included:

• T-Mobile (NASDAQ: TMUS) shares traded down approximately 0.9%.
• Deutsche Telekom's U.S.-listed American Depositary Receipts (OTCQX: DTEGY) also fell by about 0.9%.

Context of the Deal

Deutsche Telekom is the controlling shareholder of T-Mobile US, holding a majority stake in the American wireless carrier. The proposed merger aimed to fully combine the two entities but now faces a significant roadblock from the U.S. subsidiary's leadership and key stakeholders.