Sprint Nextel in talks to buy T-Mobile USA from Deutsche Telekom

Sprint Nextel, the third-largest mobile operator in the US, is in talks with German telecom giant Deutsche Telekom AG for acquiring its US subsidiary T-mobile USA, Bloomberg reported yesterday citing unidentified sources.

Deutsche Telekom aims to acquire a major chunk in the combined entity through the deal that would bring together the country's third and fourth-largest wireless operators to compete with bigger rivals AT&T Inc and Verizon Wireless. 

''In general, all options are open in the US – the sale of the whole business or of parts,'' Deutsche Telekom's chief financial officer Timotheus Hoettges told Bloomberg.

T-Mobile USA's 2010 revenue was almost flat at $21.3 billion compared to last year. Net income for the year dropped 8 per cent to $1.4 billion.

The operator has a customer base of 33.7 million, which is around 26 per cent of Deutsche Telekom's total mobile clientele. It lost around 56,000 customers during 2010 while other rivals increased their patrons. 

By revenue, Kansas-based Sprint Nextel is over 1.5 times bigger with $32.6 billion in 2010, compared to T-Mobile. The company reported a net loss of $3.5 billion for the year.