Vodafone defends AT&T bid failure

UK mobile giant Vodafone ceded a bidding war over AT&T Wireless after getting last-minute proof that the firm faced trouble ahead, Vodafone says.

Vodafone Chief Executive Arun Sarin told Sunday papers that AT&T Wireless boss John Zeglis called at 0200 GMT on 17 February to supply fresh numbers.

During the subsequent rethink at Vodafone, US competitor Cingular clinched the deal with a $41bn bid.

But Cingular sources told papers that no new numbers had emerged.

Vodafone was widely seen as having been beaten in a last-minute game of bluff by Cingular.

Shareholder relationships

In interviews with both the Sunday Times and the Sunday Telegraph, Mr Sarin was adamant that the new information - which he would not divulge - was significant.

You wouldn't want to play poker against the wheelers and dealers from Cingular Stephen Evans on Cingular's game of bluff

"We knew the business was weak, but we didn't know how weak," he told the Sunday Times.

And in the Sunday Telegraph, he called the information "extraordinary", adding that he was "very happy to lose" if winning would have cost $40bn in cash.

Mr Sarin is putting a brave face on the failure to win AT&T Wireless, not least because some shareholders are unhappy at what would have been a massive undertaking.

To buy AT&T Wireless, Vodafone would have had to sell its 45% stake in US number one carrier Verizon Wireless.

Vodafone's massive expansion during the 1990s was largely by handing out shares rather than hard cash, and Mr Sarin's ascension to the top job in place of Sir Chris Gent - architect of the firm's rise - was seen to herald a time of consolidation.

Vodafone is not the only UK operator to be embroiled in bid battles in the past week.

MMO2 on Friday rebuffed an approach from KPN, the Netherlands' biggest phone firm.

KPN now says it is considering whether a hostile bid might be a good idea.