Not so long ago, a large stake in Deutsche Telekom
would have been a nice asset for any company to have on the
balance sheet. When telecom companies were all the rage, such
holdings could be sold for a healthy profit. By last year,
however, such a block of shares was far more of a millstone
than a jewel.
When Chicago-based Telephone and Data Systems (TDS) found itself
needing to dispose of assets to improve its own situation -
including more than 130 million shares in Deutsche Telekom - the
options looked limited. Of course, it could sell the stake into the
open market, but it was painful to think about the money it could
have raised had it done that sooner. What's more, the company felt
sure that share prices wouldn't stay at such low levels for ever.
On top of that, TDS wasn't keen on a large tax bill....
