T-Mobile Agrees to Sell €2.75 Billion of Euro-Denominated Senior Notes

Rhea-AI Summary

T-Mobile US (NASDAQ: TMUS) announced that its subsidiary T-Mobile USA will sell €2.75 billion in Euro-denominated senior notes through a registered public offering. The notes are structured as:

- €1 billion in 3.150% Senior Notes due 2032
- €1 billion in 3.500% Senior Notes due 2037
- €750 million in 3.800% Senior Notes due 2045

The offering is scheduled to close on February 11, 2025. The company plans to use the proceeds for general corporate purposes, including potential share repurchases, dividends, and refinancing existing debt. The offering is being managed by a consortium of major international banks.

Positive

• Raising €2.75 billion in new capital through senior notes
• Flexible use of proceeds allowing for shareholder returns through buybacks and dividends
• Structured debt with long maturities (2032-2045) reducing near-term refinancing risk

Negative

• Increase in long-term debt obligations
• Additional interest expense from new notes (3.150-3.800% rates)

Insights

Fixed Income Analyst

T-Mobile's strategic €2.75 billion euro-denominated senior notes offering represents a sophisticated approach to debt market diversification and capital structure optimization. The three-tranche structure (€1 billion each for 2032 and 2037 notes, €750 million for 2045 notes) demonstrates careful duration management while capturing varying points on the yield curve.

The timing is particularly noteworthy given the current interest rate dynamics between the US and Eurozone markets. With European rates generally lower than US rates, this move could potentially reduce T-Mobile's overall borrowing costs. The euro-denomination also provides a natural hedge against European operations and revenue streams.

The broad intended use of proceeds, including share repurchases and refinancing existing debt, suggests a flexible capital allocation strategy. This could enable T-Mobile to optimize its capital structure while maintaining financial agility for strategic initiatives. The impressive syndicate of 24 global financial institutions indicates robust institutional demand and could facilitate strong secondary market liquidity.

The laddered maturity profile (8, 13 and 21 years) helps manage refinancing risk while the investment-grade offering should attract high-quality institutional investors. This debt issuance enhances T-Mobile's financial flexibility without significantly impacting near-term debt service obligations, given the relatively modest coupon rates ranging from 3.15% to 3.80%.

BELLEVUE, Wash.--(BUSINESS WIRE)-- T-Mobile US, Inc. (NASDAQ: TMUS) (“T-Mobile”) announced today that T-Mobile USA, Inc., its direct wholly-owned subsidiary (“T-Mobile USA” or the “Issuer”), has agreed to sell €1,000,000,000 aggregate principal amount of its 3.150% Senior Notes due 2032 (the “2032 Notes”), €1,000,000,000 aggregate principal amount of its 3.500% Senior Notes due 2037 (the “2037 Notes”) and €750,000,000 aggregate principal amount of its 3.800% Senior Notes due 2045 (the “2045 Notes,” and collectively with the 2032 Notes and the 2037 Notes, the “notes”) in a registered public offering.

The offering of the notes is scheduled to close on February 11, 2025, subject to satisfaction of customary closing conditions. T-Mobile USA intends to use the net proceeds from the offering for general corporate purposes, which may include among other things, share repurchases, any dividends declared by T-Mobile’s Board of Directors and refinancing of existing indebtedness on an ongoing basis.

Citigroup Global Markets Limited, Goldman Sachs & Co. LLC, J.P. Morgan Securities plc, Société Générale, Banco Santander, S.A., Barclays Bank PLC, BNP PARIBAS, Commerzbank Aktiengesellschaft, Crédit Agricole Corporate & Investment Bank, Deutsche Bank AG, London Branch, Mizuho International plc, Morgan Stanley & Co. International plc, MUFG Securities EMEA plc, RBC Europe Limited, SMBC Bank International plc, The Toronto-Dominion Bank, Truist Securities, Inc., UBS AG London Branch, U.S. Bancorp Investments, Inc. and Wells Fargo Securities International Limited are the joint book-running managers for the offering of the notes. ING Bank N.V., Belgian Branch, NatWest Markets Plc, PNC Capital Markets LLC and Scotiabank (Ireland) Designated Activity Company are acting as co-managers.

The Issuer has filed a registration statement (including a prospectus) with the Securities and Exchange Commission (“SEC”) for the offering of notes to which this communication relates. Before you invest, you should read the prospectus in that registration statement and the related prospectus supplement and other documents the Issuer has filed with the SEC for more complete information about the Issuer and the offering of notes. You may get these documents for free by visiting EDGAR on the SEC Web site at http://www.sec.gov. Alternatively, the Issuer, any underwriter or any dealer participating in the notes offering will arrange to send you the prospectus and related prospectus supplement if you request it by contacting Citigroup Global Markets Limited, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, Telephone: +1-800-831-9146, Email: prospectus@citi.com; Goldman Sachs & Co. LLC, Prospectus Department, 200 West Street, New York, New York 10282, Telephone: +1-866-471-2526, Facsimile: +1-212-902-9316, Email: Prospectus-ny@ny.email.gs.com; J.P. Morgan Securities plc, 25 Bank Street, Canary Wharf, London E14 5JP, United Kingdom, Attention: Head of International Syndicate, Telephone (for non-US investors): +44-20-7134-2468, Email: emea_syndicate@jpmorgan.com or J.P. Morgan Securities LLC (for U.S. investors) at +1-212-834-4533 (call collect) and Société Générale, 29, boulevard Haussmann, 75009 Paris, France, Telephone: +33 (0)1 42 13 32 16, Email: eur-glba-syn-cap@sgcib.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the notes, the related guarantees or any other securities, nor shall it constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful.

Manufacturer target market (MiFID II product governance) is eligible counterparties and professional clients only (all distribution channels). No PRIIPs key information document (KID) pursuant to Regulation (EU) 1286/2014 has been prepared as not available to retail in EEA.

Manufacturer target market (UK MiFIR product governance) is eligible counterparties and professional clients only (all distribution channels). No UK PRIIPs key information document (KID) pursuant to Regulation (EU) 1286/2014 as it forms part of UK domestic law by virtue of the EUWA has been prepared as not available to retail in the UK.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements that are based on T-Mobile management’s current expectations. Such statements include, without limitation, statements about the expected closing of the offering of the notes and statements regarding the intended use of proceeds from the offering of the notes. Such forward-looking statements are subject to certain risks, uncertainties and assumptions, including, without limitation, prevailing market conditions and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. More information about potential risk factors that could affect T-Mobile and its results is included in T-Mobile’s filings with the SEC, which are available at http://www.sec.gov.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250204109575/en/

T-Mobile US Media Relations

MediaRelations@T-Mobile.com

or

Investor Relations

investor.relations@t-mobile.com

Source: T-Mobile US, Inc.

FAQ

How much is T-Mobile (TMUS) raising in Euro-denominated senior notes?

T-Mobile is raising €2.75 billion through three tranches of Euro-denominated senior notes.

What are the interest rates and maturity dates for TMUS's new Euro notes?

The notes include 3.150% notes due 2032, 3.500% notes due 2037, and 3.800% notes due 2045.

When will T-Mobile's (TMUS) Euro notes offering close?

The notes offering is scheduled to close on February 11, 2025.

How will T-Mobile (TMUS) use the proceeds from the Euro notes?

T-Mobile plans to use the proceeds for general corporate purposes, including potential share repurchases, dividends, and refinancing existing debt.

What banks are managing T-Mobile's (TMUS) Euro notes offering?

The offering is managed by multiple banks including Citigroup, Goldman Sachs, J.P. Morgan, and Société Générale as joint book-running managers.