AT&T and Sprint were too big, Iliad was too small. After three failed acquisition attempts, it’s now unclear whether Bellevue-based T-Mobile US will continue as a stand-alone company, or if parent company Deutsche Telekom is readily courting the next round of buyers.

French telecom upstart Iliad became the latest company to see its bid for T-Mobile come up short. The company announced this week that its attempt to purchase Deutsche Telekom’s 67 percent stake in T-Mobile for $36 a share — a roughly $29 billion deal — wasn’t enough to woo Telekom. Iliad’s attempt is the third failed T-Mobile grab since 2011, but it’s unclear whether it signals a slowdown in acquisition talks for the nation’s fourth-largest wireless provider.

The Un-carrier strategy of CEO John Legere, seen here at an event in San Francisco, led T-Mobile to a profitable second quarter. French telecom company Iliad announced this week it dropped its bid to purchase T-Mobile. Photo courtesy T-Mobile.

“It underscores the idea that as long as T-Mobile continues to be successful under its current strategy, Deutsche Telekom may be resigned to the fact that its going to be a passive investor in the company for some time,” says Bill Menezes, a mobile services analyst for the research firm Gartner.

Iliad’s bid was an audacious one. The company claimed it could offer $2 billion a year in annual savings for T-Mobile, even though it has no presence in the U.S. market. Furthermore, Iliad is a small suitor. Its $29 billion offer was triple the company’s market capitalization, so it couldn’t come close to matching the huge offers of previous potential buyers Sprint and AT&T.

But there lies the quandary for T-Mobile. Deutsche Telekom agreed to give T-Mobile to AT&T for $39 billion in 2011, a deal that would have created the nation’s largest wireless provider, but that was squashed by antitrust regulators. Similar regulatory concerns ended talks between T-Mobile and Sprint earlier this year, which allowed Iliad to swoop in with an offer.

With Iliad’s bid being too small and mergers with larger competitors spooking regulators, T-Mobile has two paths it can follow: continued independent operation, or an acquisition by a non-competing company.

Those advocating the stand-alone strategy cite T-Mobile’s subscriber growth and its profitable second quarter. The company’s pioneering of Wi-Fi enabled calling, unlimited music streaming, and cheap contracts — all part of eccentric CEO John Legere’s Un-carrier marketing — has netted it at least 1 million new subscribers in each of the past five quarters.

T-Mobile’s growth wasn’t profitable, though. That changed in the second quarter of 2014, when T-Mobile announced it gained 1.5 million customers and saw a profit of $391 million. The company is now leading the industry in revenue growth and subscriber growth.

The success is encouraging for T-Mobile, but it has occurred over a short timeframe.

“T-Mobile started at a pretty low threshold, and it’s done well over the past two years,” says Menezes. “But like most large corporations outside the United States, Deutsche Telekom is probably taking a long-term view here. … They’re looking at the longer term to make sure the success is sustainable, and if it is, they’re going to wait for the return on investment that they want.”

Dish Network might be the next candidate to buy T-Mobile. Multiple reports say the satellite TV provider has discussed a purchase effort, though it hasn’t hired an advisory bank. T-Mobile declined a request for comment on the Iliad deal, and wouldn’t confirm or deny whether Dish or any other company has expressed interest.

If Dish decides to pursue T-Mobile, it might fall in the sweet spot between AT&T and Iliad. The Colorado company is large enough to offer a sizeable bid, and it is not a direct competitor to T-Mobile, which would ease regulators’ worries.

“Dish has, aside from maybe some resale agreements, has no position in the U.S. cellular market. So it would be real similar to AT&T buying DirecTV, which doesn’t seem to be inciting much regulatory opposition,” Menezes says.

The Iliad breakdown means T-Mobile will remain under Deutsche Telekom for the time being, but Menezes says it’s not a sign Telekom is holding off on receiving more offers. Rather, that it entertained Iliad at all means T-Mobile is still in play.

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