BT has rejected an £8bn bid for its local loop infrastructure, the last mile of copper and fibre lines between phone exchanges and 28 million homes and businesses.
But bidder Earth Lease says it is still hopeful of further negotiations.
If successful, Earth Lease would reportedly commit £500m a year to improving line quality and reducing the wholesale charge of ADSL.
BT employs around 35,000 staff linked to the local loop business. Earth Lease would lease the lines back to BT and other operators, and would likely cut some jobs.
The consortium, backed by a syndicate of blue chip investment banks, reportedly believes that within 18 months its lower wholesale prices could stimulate ADSL packages cheap enough to attract two million users.
This would be a significant boost for Britain Broadband, a campaign that is stalling in the face of high prices, low availability and an operator apparently reluctant to install and heavily market broadband services.
Currently, BT has to offer local loop lines to other operators, charging £122 per year in rental. But take-up has been a disaster, with just over 163 loops unbundled.
The £8bn bid would help BT cut its debts, still £17.5bn despite offloading business units, overseas interests and a new rights issue.
However, it would put the heart of the UK's phone network into the hands of a third party and encourage increased ADSL competition for BT's retail division.
Commentators said BT is unlikely to seriously entertain even a renewed bid, and may even see the offer,made back in May, as nothing but mischief-making now that details have been leaked to the press.
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