Ad hoc notification from Deutsche Telekom in accordance with § 15 of the Securities Trading Act (WpHG)
- USA- Deutsche Telekom receives high break-up fee.
U.S.telecommunications company AT&T Inc. and Deutsche Telekom have terminated the agreement on the sale of T-Mobile USA to AT&T. As a result, AT&T will pay Deutsche Telekom the break-up fee agreed in the contract signed by both companies dated March 20, 2011. This break up fee comprises of a cash payment of USD 3 billion to Deutsche Telekom, which the company expects to receive by the end of 2011, as well as a long-term agreement on 3G roaming services and a large package of mobile communications licenses for T-Mobile USA.
The termination of the transaction means Deutsche Telekom will go back to reporting T Mobile USA as continuing operations in future.
Deutsche Telekom's guidance for the 2011 financial year remains unchanged as a result of this development, with an adjusted EBITDA of around EUR 19.1 billion expected. At EUR 6.5 billion, free cash flow is forecasted to remain at the prior-year level or increase slightly. The guidance includes the T-Mobile USA contribution based on the average exchange rate in 2010 of USD 1.33 per euro. The free cash flow forecast does not include the settlement payment of EUR 0.4 billion relating to PTC in Poland nor the cash payment of USD 3 billion from the break-up fee.
Deutsche Telekom's shareholder remuneration policy also remains unchanged.
This is subject to the necessary board resolutions and other legal requirements.
Despite the termination of the agreement with AT&T, Deutsche Telekom expects to remain within the communicated ranges for certain financial performance indicators. These are as follows: The ratio of net debt to adjusted EBITDA of the Group is to be between 2 and 2.5, the equity ratio is to be between 25 percent and 35 percent, gearing (ratio of net debt to shareholders' equity) between 0.8 and 1.2, and liquidity reserves is to cover maturities of at least the next 24 months. To the extent that this release contains any statements that relate to expectations, forecasts or to the future, these statements may be associated with known and unknown risks and uncertainties. Therefore, the actual events and circumstances may differ materially from these statements. Subject to mandatory provisions of law, the company has no obligation and undertakes no obligation to publicly update or revise any of these statements to correctly reflect, subsequently to this release, the actual events and circumstances.
To the extent that this release contains any statements that relate to expectations, forecasts or to the future, these statements may be associated with known and unknown risks and uncertainties. Therefore, the actual events and circumstances may differ materially from these statements. Subject to mandatory provisions of law, the company has no obligation and undertakes no obligation to publicly update or revise any of these statements to correctly reflect, subsequently to this release, the actual events and circumstances.
