Deutsche Telekom shares rise as sources say Elliott builds stake, opposes T-Mobile deal

Deutsche Telekom holds around a 54% stake in T-Mobile. In April, Reuters reported the company was exploring a deal to combine with the U.S. arm to create a transatlantic telecoms giant, a plan that has faced shareholder opposition and weighed on its shares.

Deutsche Telekom and Elliott were not immediately available for comment. T-Mobile declined a Reuters request for comment on Wednesday. Bloomberg News first reported the news on Wednesday.

FRANKFURT, Sept 3 (Reuters) - Deutsche Telekom DTEGn.DE shares rose 1.9% in early Thursday trading as investors welcomed reports that activist investor Elliott Investment Management had built a stake and was urging the company to drop a potential merger with unit T-Mobile US TMUS.O.

Elliott, an activist investor known for high-profile campaigns at some of the world's biggest groups including BP BP.L, opposes the T-Mobile deal and would prefer alternative options to unlock shareholder value, including larger share buybacks, according to a person familiar with the matter, who spoke on condition of anonymity because the matter was private.

The fund has built a stake in the German telecommunications company, that person and a second one familiar with the matter said. Reuters could not determine the size of the stake.

Under German law, shareholdings above 3% must be disclosed publicly.