US mobile phone giant AT&T put an end to speculation that a bid for Vodafone was imminent, following reports that it has been in talks with European regulatory authorities over a possible takeover.

AT&T was forced to put out the statement at the behest of Britain’s takeover regulator, after it was reported at the weekend that the American firm’s chief executive Randall Stephenson had met with the European Commissioner for Telecoms, Neelie Kroes.

Stephenson had previously spoken of his interest in the European mobile broadband market. Shares of Vodafone fell over 5 per cent in afternoon trade in London, following the announcement.

Takeover rules

UK takeover rules mean that following its declaration, AT&T won’t be able to make an offer for the British company in the next six months, unless Vodafone agrees to the statement being put aside, another company makes an offer for it, or the Takeover Panel believes there has been a “material” change in circumstances.

While AT&T is seen as having a number of options for moving into Europe, and has never specifically pointed to Vodafone, the British firm’s imminent sale of its 45 per cent stake in Verizon Wireless to Verizon for $130 billion at the end of February has put it at the top of the list of potential targets.

While Vodafone has been increasing its investment outside Europe — it is set to acquire the remainder of its Indian joint venture that it doesn’t already own after winning government approval — it has also been strengthening its position on the continent.

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