Deutsche Telekom Continues to Execute Well Through 2021

We are pleased with T-Mobile US' (44% owned by Deutsche Telekom, or DT) strategic move to merge with Sprint. In the long term, DT should benefit from larger operational scale and the additional spectrum holdings from the Sprint merger. Since the closure of the merger in 2020, T-Mobile has made decent progress on the integration by cutting costs through network and personnel efficiencies. DT has a good track record of past acquisitions, like MetroPCS in the U.S, and we believe DT is well positioned to achieve a sustainable place in the U.S. telecom landscape, where it has been gaining market share for several quarters. As a result, after the integration phase, we expect margin expansion and an improved business profile. This should enable DT’s U.S. business to fund the investments needed to remain competitive while generating acceptable returns on capital.