Telco rumourmill works into overtime after Orange deal

NEWS Takeover speculation and actual deals have continued apace in Europe since Mannesmann last week announced its £19bn purchase of Orange. Vodafone AirTouch has played down rumours that it will now mount a hostile bid for Mannesmann, even though the German company's investors and bondholders are revolting. A successful takeover would mean Vodafone having to divest Orange, as owning both operations in the UK would be frowned upon by regulators. For now - and in spite of a falling Mannesmann share price making it an attractive target - Vodafone has said it will work with Mannesmann. It is, after all, a 35 per cent shareholder in the Mannesmann Mobilfunk business, which runs Germany's leading D2 network. Meanwhile, BT is expected to take full control of Viag Interkom, the German venture the UK telco will concentrate on after striking its alliance with AT&T, which also held stakes in the country. BT currently owns 45 per cent of Viag. Concert, the BT-AT&T joint venture, cleared its final regulatory hurdle at the weekend, gaining approval from the US Federal Communication Commission. Also internationally, in line with its long-term strategy, Cable and Wireless has disposed of £380m worth of minority holdings in Israeli telcos. The deals bring sales this year to over £7bn, and speculation has now turned to more central C&W operations such as Australia's Optus and Hong Kong Telecom. An absence of debt and a conservative acquisition strategy continue to fuel speculation that C&W is itself vulnerable to a takeover.