The possibility of T-Mobile’s acquisition over the past few months has been heavily reported and while initially it was believed that Sprint will go ahead and pick it up, now it looks like T-Mobile US may come under French ownership. Recently French telco Iliad submitted a surprise bid for the carrier which was ultimately rejected for being too low. Since then Iliad has reportedly reached out to private equity firms in order to raise finances and submit a revised bid that would be acceptable to T-Mobile’s majority stake holder Deutsche Telekom.
French low-cost telecom operator Iliad has set a mid-October deadline to decide whether to improve its bid for T-Mobile US or walk away as it faces resistance from seller Deutsche Telekom, several people familiar with the situation said. Deutsche Telekom, which owns 66 percent of the fourth-largest U.S. carrier, has doubts that Iliad will be able to improve the U.S. business since the French startup has no track record in the country, a source close to the German company’s management said. Under the deal structure proposed by Iliad, Deutsche Telekom would have to keep a stake in the combined company. Iliad is currently in talks with several U.S. banks to help it finance a possible improved bid for T-Mobile US alongside existing lenders HSBC and BNP Paribas, the people familiar with the situation said, after a $33 per share offer for 56.6 percent of T-Mobile US was rejected by Deutsche Telekom.