Vodafone's rivals show interest in buying T-Mobile UK

Furthermore, Orange is saying that it has been in negotiation with T-Mobile for some time, talks are at an advanced level and Vodafone's bid (believed to be about £3 billion) is an unwelcome attempt to spoil a deal that, to all intents and purposes, is already close to done.

After days of blank-faced denial that it is involved in a takeover bid for the struggling Deutsche Telekom (DT) subsidiary Vodafone yesterday conceded that it has made a "preliminary approach" to the company - something that everyone in the industry knew anyway. What is it they say about lies, damned lies and statistics?

However, while Vodafone is looking for a straightforward takeover of T-Mobile, the Orange deal is somewhat sweeter as it would allow DT to participate in a form of joint venture that would bring pecuniary advantages to both parties. Rumour has it that the two operators have done the arithmetic and believe that a tie-up will bring what they describe as "synergy benefits" to the tune of between €4 billion and €6 billion.

Speculation is also rife that O2 is thinking of making a bid for T-Mobile UK.

Nonetheless both Orange and O2 continue to protest that they have no interest in T-Mobile. God knows who they think they are kidding but they continue their bare-faced denials even as the object of their attentions comes clean and admits that is up for sale and in talks with prospective buyers.

And, although it is widely accepted that T-Mobile is underperforming in Britain's crowded and cut-throat mobile market DT is not prepared to rid itself of the unit at a knock-down price. The parent company's pockets are long enough and the management determined enough to hold out for the top offer from the highest bidder - even if it has to wait for months for it to materialise.

It is known that Orange has had its eye on T-Mobile UK for some time and has made several unsolicited offers for it in the past.

It has also made efforts to enlarge its presence by pushing for a network-sharing deal with the DT subsidiary that would be similar to the one already enjoyed by Hutchison's 3.

Certainly it is evident that the market is hotting up - despite all the denials and obfuscation. Acting on T-Mobile's instructions, the investment  bank, JP Morgan, is touting the company around looking for offers. There is also speculation that UK and EU regulators have also given a takeover deal the quiet nod - despite the fact that an acquisition by Vodafone would create an entity commanding 40 per cent of the British mobile market - a dominant position by any definition.

No carrier is going to go to all the fuss and expense of mounting a takeover bid unless it is pretty well assured that the deal won't be scuppered down the line by the regulators. One can't help but think that there's a bit of a stitch-up taking place.

T-Mobile claims to have 17 million subscribers in Britain but more than four million of these are Virgin Mobile subscribers. Virgin has a long-standing deal whereby the popular MVNO piggy-backs on the T-Mobile network. If T-Mobile were to be sold there would be major ramifications for Virgin Mobile's business and it is expected that Virgin would exercise its rights, enshrined in a clause of its agreement with T-Mobile, to move its business elsewhere if the company is taken-over. That would leave T-Mobile in a weakened condition and would surely be a major factor in negotiations. If more than four million network users disappear overnight, the valuation of the company must be reduced.

And one has to also to consider Vodafone’s 45 per cent interest in Verizon Wireless of the US and compare the prospects for T-Mobile with Verizon Wireless in the American market.

According to Execution (and what a strange name for a telecoms research organisation that is) Verizon Wireless is Vodafone’s most important asset. The stake is worth some £51 billion - and that  equates to the combined value of Vodafone's UK, German, Italian and Spanish interests.