T-Mobile US looks to raise $2 billion for spectrum purchases

12 November 2013 | Kavit Majithia


T-Mobile US has announced a stock offering that could generate approximately $2 billion for spectrum purchases.

The company said it would sell 66.15 million shares – roughly equivalent to 9% of its existing outstanding shares – and use the proceeds to acquire airwaves and boost its network capacity for wireless and data services.

Parent company Deutsche Telekom, which owns 74% of T-Mobile US, will see its stake cut to 67% after the sale, but said it would not sell its shares.

Investors were reportedly concerned over dilution of the value of shares after the company said it could raise money for spectrum in an equity offer earlier in November.

The company has declined to comment on what spectrum it will use the proceeds for.

The timing of the company’s offer has been surprising, according to analysts, with the market expecting that T-Mobile would make the move when the government auctions spectrum licences owned by broadcasters next year.

T-Mobile could also be interested in spectrum assets sold at auction, which includes assets owned by wireless business LightSquared, with the auction expected to take place in December.