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Five private equity groups ‘interested in buying T-Mobile Netherlands’

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Five private equity companies are interested in buying T-Mobile Netherlands from Deutsche Telekom, according to reports this morning.

The Bloomberg agency says that the German company’s plan to sell its Dutch operation has attracted interest from Apax Partners, Apollo Global Management, BC Partners, Providence Equity Partners and Warburg Pincus.

The report said that Deutsche Telekom is working with Morgan Stanley, which has sent out information on the business to potential bidders. Bloomberg did not name its sources, one of whom said that the investment bank wanted first-round offers in July. 

Tele2 has a 25% stake in T-Mobile Netherlands, but Tele2 CEO Kjell Johnsen said in May that the company wanted to sell its stake.

Deutsche Telekom was also reported in January to be wanting to sell T-Mobile Netherlands. A report in Amsterdam-based financial publication Het Financieele Dagblad, said it believed the operation would attract between €4 billion to €5 billion from private equity investors.

The latest report puts the price that Deutsche Telekom expects now at exactly the midpoint of that range – €4.5 billion.

But six years ago Bloomberg also reported that Deutsche Telekom was considering a sale of T-Mobile Netherlands that could be valued between €4 billion and €5 billion. Then the German operator was working with Credit Suisse.

Jacques de Greling of Scope Ratings said this morning that “the sale would help it partially finance investments in the works, and importantly, the upcoming capital increase for T-Mobile US”.

He added: “As for a possible buyer of T-Mobile Netherlands, we can only see room for a financial firm. The Dutch market is already highly concentrated (KPN and Vodafone-Ziggo are the only other big players) and the lack of synergies will deter foreign telecoms operators.”

The merger with Tele2’s Netherlands operation, completed in January 2019, was intended to create a powerful fixed and mobile company to compete with KPN and VodafoneZiggo, both of which offer fixed and mobile services.

Back in early 2019 Thorsten Langheim, head of the group development segment of Deutsche Telekom overseeing T-Mobile Netherlands, said “We now can truly live up to our promise to become the customer champion.” 

He is responsible for Deutsche Telekom’s US business as well as corporate development, portfolio strategy and group mergers and acquisitions activities. This includes overseeing Deutsche Telekom’s 12% stake in BT.

October-December 2020 revenue for T-Mobile Netherlands was €505 million, down from €513 million in the same period in 2019. But annual revenue was up 2% to €1.95 billion.