Deutsche Telekom Pushes Deeper Into US Wireless

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Deutsche Telekom (DT) is buying SunCom Wireless (TPC) for $1.6 billion. The German phone giant will pay $27 a share. TPC stock closed at $22 on Friday.

SunCom has one million customers "in the south-eastern US and in the Caribbean", according to the FT.

DT has a problem in the US, Its T-Mobile units runs a distant fourth behind Verizon Wireless, AT&T (T), and Sprint (S). Getting closer to them in size through direct customer acquisition would be impossible. So, DT has decided to buy wireless consumers in bulk.

DT cannot afford larger US wireless operators like AllTel (AT) which was recently picked up by private equity interest. AllTel has a market cap of $24 billion. So, the German company is taking smaller steps.

Against the like of AT&T and Verizon Wireless, small steps won’t work.

Douglas A. McIntyre