19 Shareholders’ equity

Issued capital

As of December 31, 2022, the share capital of Deutsche Telekom AG totaled EUR 12,765 million. The share capital is divided into 4,986,458,596 no par value registered shares.

Treasury shares. The amount of issued capital assigned to treasury shares was approximately EUR 35 million at December 31, 2022. This equates to 0.3 % of share capital. 13,757,255 treasury shares were held at December 31, 2022.

The shareholders’ meeting resolved on April 1, 2021 to authorize the Board of Management to purchase shares in the Company by March 31, 2026, with the amount of share capital accounted for by these shares totaling up to EUR 1,218,933,400.57, provided the shares to be purchased on the basis of this authorization in conjunction with the other shares of the Company that the Company has already purchased and still possesses or are to be assigned to it under § 71d and § 71e AktG do not at any time account for more than 10 % of the Company’s share capital. Moreover, the requirements under § 71 (2) sentences 2 and 3 AktG must be complied with. Shares shall not be purchased for the purpose of trading in treasury shares. This authorization may be exercised in full or in part. The purchase can be carried out in partial tranches spread over various purchase dates within the authorization period until the maximum purchase volume is reached. Dependent Group companies of Deutsche Telekom AG within the meaning of § 17 AktG or third parties acting for the account of Deutsche Telekom AG or for the account of dependent Group companies of Deutsche Telekom AG within the meaning of § 17 AktG are also entitled to purchase the shares. The shares are purchased through the stock exchange in adherence to the principle of equal treatment (§ 53a AktG). Shares can instead also be purchased by means of a public purchase or share exchange offer addressed to all shareholders, which, subject to a subsequently approved exclusion of the right to offer shares, must also comply with the principle of equal treatment.

The shares may be used for one or several of the purposes permitted by the authorization granted by the shareholders’ meeting on April 1, 2021 under item 7 on the agenda. The shares may also be used for purposes involving an exclusion of subscription rights. In addition, they may be sold on the stock market or by way of an offer to all shareholders, or withdrawn. The shares may be used to fulfill the rights of Board of Management members to receive shares in Deutsche Telekom AG, which the Supervisory Board has granted to these members as part of the arrangements governing the remuneration of the Board of Management, on the basis of a decision by the Supervisory Board to this effect. Furthermore, under the authorization granted on April 1, 2021, the Board of Management is authorized to offer and/or grant shares to employees of Deutsche Telekom AG and of lower-tier affiliated companies as well as to managing board members of lower-tier affiliated companies; this also includes the authorization to offer or grant shares free of charge or on other special conditions.

Under the resolution of the shareholders’ meeting on April 1, 2021, the Board of Management is also authorized to acquire the shares through the use of equity derivatives.

No treasury shares were acquired in the reporting period and in the prior year. Currently, the treasury shares for participants of the Share Matching Plan and of the employee share program Shares2You are issued from the pool of shares previously held in a trust deposit.

As part of the acquisition of VoiceStream Wireless Corp., Bellevue, and Powertel, Inc., Bellevue, in 2001, Deutsche Telekom AG issued new shares from authorized capital to a trustee, for the benefit of holders of warrants, options, and conversion rights, among others. These options or conversion rights expired in full in the 2013 financial year. As a result, the trustee no longer had any obligation to fulfill any claims in accordance with the purpose of the deposit. The trust relationship was terminated at the start of 2016 and the deposited shares were transferred free of charge to a custody account of Deutsche Telekom AG. On the basis of authorization by the shareholders’ meetings on May 25, 2016 and April 1, 2021, the treasury shares acquired free of charge may be used for the same purposes as the treasury shares acquired for a consideration. In the reporting year, 708 thousand previously deposited shares were reallocated for issue to eligible participants of the Share Matching Plan (prior year: 3,462 thousand shares).

For matching shares from the Share Matching Plan and for free shares from the employee share program Shares2You, treasury shares are transferred free of charge to the custody accounts of employees of Deutsche Telekom AG. In cases where treasury shares are transferred to the custody accounts of employees of other Group companies, the costs have been transferred at fair value to the respective Group company since the 2016 financial year. Where treasury shares were transferred to the custody accounts of employees that were bought by way of the personal investment as part of the employee share program Shares2You, a conversion rate of EUR 18.78 per share was used. The conversion is determined using the lowest price at which a trade actually took place on an official German exchange on the date of conversion.

In all months of the reporting year, except for September, treasury shares (760 thousand in total) were reallocated and transferred to the custody accounts of eligible participants (prior year: 3,485 thousand treasury shares). As of December 31, 2022, disposals of treasury shares resulting from the transfers in the reporting period accounted for 0.02 %, or EUR 1,947 thousand, of share capital. Gains on disposal arising from transfers of treasury shares amounted to EUR 12,225 thousand. The transfers of treasury shares increased the capital reserve by EUR 10,278 thousand. In the reporting year, 367 thousand treasury shares with a fair value of EUR 6,737 thousand were billed to other Group companies.

Voting rights. Each share entitles the holder to one vote. These voting rights are restricted, however, in relation to treasury shares (at December 31, 2022: around 14 million in total).

Authorized capital and contingent capital. Authorized capital and contingent capital comprised the following components as of December 31, 2022:

Changes in the composition of the Group, transactions with owners, and capital increase.

The following table shows the changes in the composition of the Group, the development of transactions with owners, and the capital increase made against contribution in kind in the prior year:

Changes in the composition of the Group in connection with the sale of T‑Mobile Netherlands reduced the carrying amount of shareholders’ equity by EUR 0.6 billion. Transactions with owners decreased the carrying amount of shareholders’ equity by EUR 6.0 billion, mainly in connection with the further acquisition of T‑Mobile US shares to increase the stake and with the share buy-back program underway at T‑Mobile US.

In connection with the agreement concluded on September 6, 2021 between Deutsche Telekom AG and SoftBank for the acquisition of around 45.4 million T‑Mobile US shares, an increase in issued capital was entered in the commercial register and executed on September 28, 2021 by issuing 225 million no-par-value shares at the lowest issue price of EUR 2.56 per share against contribution in kind. Issued capital was increased by EUR 576 million in total. The number of Deutsche Telekom AG’s outstanding shares increased as a result from 4,761 million to 4,986 million shares.

The non-cash capital increase was executed by SoftBank contributing 45.4 million T‑Mobile US shares to Deutsche Telekom AG in return for the transfer of 225 million Deutsche Telekom AG shares from the 2017 authorized capital. Because T‑Mobile US was already included in Deutsche Telekom’s consolidated financial statements as a fully consolidated subsidiary, the increase in the stake merely led to a decrease in the non-controlling interests in consolidated shareholders’ equity by EUR 2,358 million and to an increase in the share of equity held by the owners of the parent company by a net total of EUR 1,511 million.

In order to acquire the some 45.4 million T‑Mobile US shares, on September 23, 2021, Deutsche Telekom AG exercised some of the stock options received from SoftBank in June 2020. On the exercise date, these stock options had a fair value of EUR 847 million. This amount was recognized directly in equity as part of the consideration (within the meaning of the IFRSs) paid to SoftBank, as a result of the derecognition of the exercised options (issued capital and reserves attributable to owners of the parent). The carrying amount of other financial assets decreased as a result.

Non-controlling interests: total other comprehensive income

Total other comprehensive income of non-controlling interests primarily comprises remeasurement effects as part of the acquisition of the OTE group totaling EUR 0.3 billion (December 31, 2021: EUR 0.3 billion), as well as currency translation effects of EUR 1.8 billion (December 31, 2021: EUR 0.3 billion), and remeasurement losses recognized directly in equity in connection with forward-payer swaps concluded for borrowings at T‑Mobile US, which were terminated prematurely in April 2020.