Late last week, French operator Iliad made a $15 billion bid for Deutsche Telekom’s T-Mobile US, but sources have said that the offer is not serious enough for the German operator to walk away from a rival offer from Sprint.
“It is better to have a bird in the hand than two in the bush, but the question is, at what price?” the source said. “And this discount compared to the Sprint/SoftBank offer seems too high.”
Iliad’s offer values the US mobile player at $33 per share, while the offer from Sprint stands at $40 per share.
Deutsche Telekom is also said to be doubting Iliad’s leadership and ability to compete with major US rivals AT&T and Verizon without additional spectrum and capital.
However, Sprint’s bid – although more attractive financially – is likely to encounter more regulatory difficulties as it would shrink the number of big players in the market from four to three, while Iliad’s offer will not.
Sources confirmed that Deutsche Telekom will continue to consider both offers.
