Mobile phone giant Vodafone is poised to table a formal takeover bid for Italian broadband group Tiscali, it was reported today.
Vodafone is said to be planning to make an offer for the whole of Tiscali in the next 24 hours, according to Italian press reports.
The mobile group is believed to be one of a number of firms shortlisted in the auction to buy Tiscali, which has been up for sale since it launched a strategic review in February.
Tiscali has broadband operations across the UK and Italy and is seen as an attractive match for Vodafone, which is focussing on business such as fixed line broadband to offset slowing growth in the saturated European mobile phone market.
Vodafone also lacks a fixed line broadband business in the UK, where Tiscali has 1.2 million broadband users and is the fourth largest player, with a market share of around 12%.
It is also thought that Vodafone would seek to merge Tiscali's Italian arm with its recently-acquired Tele2 operations in Italy.
Vodafone has been competing against a raft of groups keen to snap up Tiscali, including BT, BSkyB and Carphone Warehouse.
It is understood that Carphone Warehouse failed to make it on to the shortlist, but around six companies are reportedly competing in the final round.
Tiscali is expected to fetch about €1.6bn, with the price tag for the UK business alone seen as being more than £500m (€631.67m).
Tiscali refused to be drawn on the final stages of the auction or price, except to say that takeover talks were continuing.
It said in a statement: "Negotiations are ongoing with several operators and the price is part of such negotiations."
The group makes nearly three quarters of its revenues in the UK, last month reporting a 55% leap in first quarter UK sales to €197.9m.
Total sales up 43% helped Tiscali narrow its first quarter net loss by 12% to €37.5m.
Tiscali is considering breaking the business up to secure a sale, although Vodafone is reported to be planning a bid for the entire group.
Vodafone was not immediately available for comment, but has been clear in its aims to tap into fixed broadband business.
It has been cutting costs to counter slowing revenue growth in its core markets and preparing itself for a push into lower-margin activities, such as broadband.