Vodafone has revealed it is considering buying Cable and Wireless Worldwide (CWW) to boost its infrastructure assets and move in to the enterprise services market.
The firm said in a statement it was considering the merits of such a purchase, but no decision had yet been made.
"Vodafone regularly reviews opportunities in the sector and confirms that it is in the very early stages of evaluating the merits of a potential offer for CWW. There is no certainty that an offer will be made nor as to the terms on which any offer might be made," it said.
"Any offer, if made, will be in cash but Vodafone reserves the right to change the specie of consideration. A further announcement will be made in due course, if appropriate."
Ovum principal analyst David Molony said the appointment of former Vodafone executive Gavin Darby to chief executive at CWW had been an indicator a buyout could occur, and added such a move would offer the firm several benefits.
"A merger would give Vodafone significant global network for fixed services to complement or even integrate with its mobile operations worldwide, and give it a significant position in global enterprise services," he said.
"Second, it fits with an Asia-Pacific growth strategy for Vodafone - CWW has the highest penetration of the business fixed services market in Asia-Pacific of the European and US-owned telecoms service providers."
He warned that if the firm did go ahead with the acquisition it could cause the firm some difficulties.
"It has some major contracts with global multi-nationals that get their fixed services from other telcos like BT. Those customers who want more collaboration on fixed-mobile services will wonder where Vodafone's ownership of CWW leaves them."
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