TheChek News Flow

Timotheus Höttges transformed Deutsche Telekom by doubling down on America’s maverick brand, T-Mobile. His final test: a $300 billion-plus deal.

Timotheus Höttges is about to embark on the most ambitious test of his professional career: trying to push through the largest public-company merger in history.

Höttges already runs Deutsche Telekom DTE 3.06%increase; up pointing triangle, the West’s largest telecommunications company with 273 million mobile customers in 50 countries and a 54% stake in T-Mobile TMUS 3.25%increase; green up pointing triangle US. Now, he is reportedly looking to marry the straight-laced German firm with its flashy American offshoot.

Constant price pressure and regulatory intervention make telecom a “scheißindustrie”—a crappy industry—Höttges said in February on “OMR,” a German podcast about marketing. But he has found success in it.

During his 12-year tenure as Deutsche Telekom’s chief executive, Höttges has helped turn T-Mobile from a money-losing underdog to the world’s most valuable telecom brand by market capitalization.

But analysts say T-Mobile is constrained on large deals: Its high leverage makes borrowing expensive, and it can’t issue stock without diluting its German parent’s stake. By combining Deutsche Telekom and T-Mobile into a single $300 billion behemoth, the company would likely be able to raise debt at a lower cost, among other benefits.

T-Mobile aims to buy fiber-internet operators in the U.S. to compete with AT&T and Verizon and offer bundled wireless and home internet to more customers.

To pull off the merger, Höttges will have to win over T-Mobile shareholders who own the remainder not held by Deutsche Telekom and who see little upside as the merger would expose them to lower-margin foreign businesses. And he will need to convince the German state, which owns 28% of Deutsche Telekom. Should he get those votes, he will then have to navigate a complex regulatory approval process that would involve national-security review by two governments.

Höttges, 63 years old, grew up near Düsseldorf. He earned a business degree, took a job in consulting, and by 2000 was chief financial officer of Deutsche Telekom’s German unit. That same year, the company struck a deal to buy the Bellevue, Wash.-based carrier then known as VoiceStream Wireless.

As Höttges rose through the ranks at Deutsche Telekom—overseeing the German unit, European mobile operations and fixed-broadband operations before becoming chief financial officer in 2009—the American asset became the empire’s problem child, known for poor network coverage.

Höttges and then-CEO René Obermann struck a deal in 2011 to sell T-Mobile to AT&T. The sale was scrapped after the Justice Department sued.

The pair then plotted a new approach: go all-in on America. They used their massive breakup fee from AT&T, including spectrum and some $3 billion in cash, to improve T-Mobile’s network and expand the business.

Höttges worked on the plans with Obermann—first to sell T-Mobile, then to save it—in his signature deliberative process, Obermann recalled in an interview. For every idea, Höttges insisted on considering the antithesis as well.

“If nobody contradicts him, he himself becomes his own dialectical force,” Obermann said. Many years before Höttges became CFO, the two had bought land in Bonn together and built neighboring houses. They kept up their discussions well past midnight, then often jogged together the next morning.

When Höttges took the reins from Obermann in 2014, T-Mobile’s fortunes were rising. John Legere, T-Mobile’s CEO at the time who pitched the company as the “Un-carrier,” sprinkled emojis throughout his communications, answered customer complaints on social media and attracted subscribers with discounts and flexible contract terms.

As T-Mobile’s chairman, Höttges occasionally clashed with the brash Legere. In 2015 Höttges publicly called his discounting unsustainable. Legere fired back on social media, calling Höttges’s comments “total bulls—.”

Legere didn’t respond to a request for comment.

“Höttges picked the right horse. Then he gave the horse enough fodder for it to run fast,” said Roger Entner, founder of telecom research firm Recon Analytics, whose clients include T-Mobile.

Höttges has called T-Mobile’s 2020 acquisition of Sprint his greatest achievement. Talks repeatedly broke down, as he went toe-to-toe with Masayoshi Son, CEO of Sprint’s majority owner, SoftBank, and a famously tough negotiator. Legere and other U.S. executives led talks with American regulators, and T-Mobile ultimately landed the deal that valued Sprint at $59 billion, including debt. The transaction gave the company more firepower to pursue fifth-generation wireless technology.

Höttges has invested billions in T-Mobile’s U.S. infrastructure to support its fixed-wireless home-internet product. He has also put billions into expanding the German network, where fiber-internet subscribers have nearly tripled since 2023.

He champions a cause popular with European regulators: tech sovereignty, or reducing reliance on American and Chinese tech. In February Deutsche Telekom opened Germany’s first AI gigafactory, a massive data center. (The gigafactory uses chips from Nvidia, which is an American company.)

Server cabinets illuminated by pink neon lights in the Industrial AI Cloud data center.

Sven Hoppe/dpa via Zuma Press

T-Mobile contributes nearly two-thirds of Deutsche Telekom’s revenue. The growing U.S. operation has made political overtures to the Trump administration, which has meant Höttges at times walks a trans-Atlantic tightrope to keep governments and stakeholders in both Germany and the U.S. happy.

Last year T-Mobile ended some policies related to diversity, equity and inclusion, joining a wave of companies rethinking their language and commitments around those issues. Höttges got thousands of emails about it, including from angry German shareholders, said people familiar with the matter.

“We continue to live our culture of diversity in the U.S., as we do everywhere, and ensure that no one is discriminated against at work,” said a Deutsche Telekom spokesman, adding that diversity remains a driver of the company’s success. “At the same time, we respect the political framework in the U.S.”

Another thorny moment came from T-Mobile’s donation to the White House’s new ballroom. Some members of Deutsche Telekom’s supervisory board became concerned the donation could expose the parent company to allegations of illegally bribing a foreign government, said people familiar with the matter.

Höttges was asked about the gift when that board met in December, said people who attended the meeting. He replied that T-Mobile hadn’t known the gift, around $4 million, was for a ballroom, and gave the money to the Trust for the National Mall believing it would be used for America’s 250th anniversary celebrations, the people said.

A Deutsche Telekom spokesman declined to comment on the meeting. T-Mobile referenced a statement from October, in which a spokesperson said the company donated to the Trust, which helps to “restore and enrich the historic landmarks that define our nation’s capital, such as the White House ballroom.” The spokesperson added, “T-Mobile has no role in the use of those funds or decisions related to the construction of the ballroom.”

Höttges plans to retire at the end of 2028 and wants the right successor to be found first, said people familiar with the matter.

He said on the “OMR” podcast that his successor will need a different skill set. Artificial intelligence is overhauling the workforce and automating next-generation networks, transforming the industry at an astonishing pace.

“Back then, a sober numbers guy was the right choice,” he said. “Today, I believe we need a visionary who understands the future architecture of modern infrastructure.”