AT&T in 'advanced talks' to buy DirectTV for $50bn


City hopes of a takeover bid for Vodafone by AT&T were dashed after it emerged the American telecoms giant is in advanced talks over a $50 billion (£30 billion) move for US satellite TV operator DirecTV.

Vodafone shares fell as much as 2 per cent.

Speculation about an AT&T-Vodafone tie-up soared in January, forcing the US giant to rule out a bid for six months under City “put-up-or-shut-up” takeover rules. Andrew Hogley, analyst at Espirito Santo, said: “Expectations of a bid have been diminishing.

“If AT&T is bidding for DirecTv, it makes it even less likely.” If AT&T and DirecTV merge, it would be close in size to Comcast’s planned tie-up with Time Warner Cable.

It is the latest move in a merger frenzy on both sides of the Atlantic as broadband, mobile and pay-TV converge. BSkyB is looking to buy Sky Deutschland and Sky Italia while Vodafone has bought Spain’s Ono and Germany’s Kabel Deutschland.

Hogley warned Vodafone shares were also being hit by “mixed results” from European peers.