Ratings on Deutsche Telekom AG Remain on CreditWatch Negative After Voicestream Announcement

LONDON (Standard&Poor's CreditWire) July 25, 2000--Standard&Poor's double-'A'-minus long-term and 'A-1'-plus short-term corporate credit ratings on Deutsche Telekom AG (DTAG) remain on CreditWatch with negative implications following the company's formal offer to purchase VoiceStream Wireless Corp. (B/Watch Pos/--) for $50.7 billion--euro (Eur) 54.1 billion. The offer has received support from VoiceStream's core shareholders, representing more than 50% of outstanding shares. The transaction involves a fixed exchange ratio of 3.2 DTAG shares plus $30 for every VoiceStream share. This equates to a cash commitment by DTAG of about $7.8 billion. In addition, DTAG will consolidate about $5 billion of existing net debt at VoiceStream and commit to invest, before the purchase closes, a further $5 billion in VoiceStream

...LONDON (Standard & Poor's CreditWire) July 25, 2000--Standard & Poor's double-'A'-minus long-term and 'A-1'-plus short-term corporate credit ratings on Deutsche Telekom AG (DTAG) remain on CreditWatch with negative implications following the company's formal offer to purchase VoiceStream Wireless Corp. (B/Watch Pos/--) for $50.7 billion--euro (Eur) 54.1 billion. The offer has received support from VoiceStream's core shareholders, representing more than 50% of outstanding shares. The transaction involves a fixed exchange ratio of 3.2 DTAG shares plus $30 for every VoiceStream share. This equates to a cash commitment by DTAG of about $7.8 billion. In addition, DTAG will consolidate about $5 billion of existing net debt at VoiceStream and commit to invest, before the purchase closes, a further $5 billion in VoiceStream in the form of convertible preferred stock. This convertible stock will be used to fund license auctions and a building out of the network in the U.S. The transaction is expected...

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