T-Mobile US announces offering of 66.15 million shares
NEW YORK (Reuters) - T-Mobile US Inc, the No. 4 U.S. mobile service provider, said on Monday that it would sell 66.15 million common shares, representing roughly 9 percent of its existing shares outstanding, sending its shares down almost 3 percent in late trade.
T-Mobile said it may use the proceeds to buy spectrum.
The plan implies a transaction value of $1.96 billion, based on T-Mobile's closing share price on Monday of $26.97, and includes an offer of 6.6 million extra shares for underwriters.
Deutsche Telekom, which currently owns 74 percent of T-Mobile, said on Twitter that its stake would be reduced to 67 percent as a result of the share sale, but it was not selling its own shares.
T-Mobile raised concerns among some investors over dilution of the value of its shares when it said on November 5 that it could look to raise money for spectrum purchases via a debt or equity offering.
New Street analyst Jonathan Chaplin said the timing of the offering was surprising as he had expected T-Mobile to wait until closer to the time of a government auction of spectrum licenses owned by broadcasters, slated for 2014 or later.
Chaplin said the timing of the offering may mean that T-Mobile wants to raise funds ahead of a spectrum auction, which is expected to go ahead in January with bidders including Dish Network and Sprint Corp.
"There is a chance that they may get involved in the LightSquared process, but this seems unlikely," Chaplin said.
LightSquared Inc, a wireless telecoms business, is in bankruptcy, and its spectrum assets are to be sold at auction, which is expected to take place in December
So far, satellite TV provider Dish is the only company that has publicly expressed interest in the LightSquared spectrum.
T-Mobile said on Monday that it has 728.7 million shares outstanding, including Deutsche Telekom's stake. Other shareholders own roughly 190 million shares.
Many U.S. mobile operators have been looking to increase their spectrum holdings because additional airwaves can boost network capacity to support customers who are using more and more bandwidth-hungry data services.
T-Mobile has to push hard to regain ground after losing subscribers for four years. It started to turn the corner in the second quarter.
The company's shares fell almost 3 percent in after-the-bell trade to $26.25 after closing down 2.5 percent in the regular New York Stock Exchange session.
T-Mobile said that Morgan Stanley, Goldman, Sachs, J.P. Morgan, Credit Suisse and Deutsche Bank are the joint book-running managers for the offering.
(Reporting by Sinead Carew; Editing by Leslie Adler and Leslie Adler)
- Exclusive: Radar data suggests missing Malaysia plane deliberately flown way off course - sources
- Investigators focus on foul play behind missing Malaysia plane: sources |
- Kremlin website hit by 'powerful' cyber attack
- West prepares sanctions as Russia presses on with Crimea takeover |
- UPDATE 1-Rolls-Royce concurs with Malaysia on missing jet's engine data