German govt mulls options to bolster Deutsche Telekom -report

FRANKFURT Mon Dec 17, 2012 3:20am EST

FRANKFURT Dec 17 (Reuters) - The German government is considering options to lend support to Deutsche Telekom to enable the phone company to spend more on its broadband networks, Handelsblatt reported on Monday, citing sources.

Bonn-based Deutsche Telekom may be spared having to pay a dividend to Germany's state-owned investment bank KfW and instead issue new shares, the newspaper said.

Germany owns a 15 percent direct stake in Deutsche Telekom as well as a 17 percent indirect stake through KfW.

A decision has not yet been taken on the matter, Handelsblatt reported. A spokesman for the Berlin-based ministry was not immediately available for comment.

"Whether or not a shareholder will endorse such a dividend in kind is up to the shareholder himself," a Telekom spokesman said.

Deutsche Telekom said on Dec. 7 it would increase its annual investments by more than 1 billion euros ($1.3 billion) to 9.5 billion in 2015, compared with an estimated 8.3 billion euros this year, rolling out faster broadband and next-generation 4G networks, as it also cut its dividend by almost 30 percent. ($1 = 0.7628 euros) (Reporting by Till Weber; Writing by Andreas Cremer; Editing by David Holmes)

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