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AOL and Tiscali attract bidders

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Update Consolidation in the broadband sector looks set to continue apace, as Carphone Warehouse and BSkyB fight it out for control of AOL's UK broadband business, according to reports.

Earlier, Orange was understood to be interested in the buy, but pulled out last night, The Times reports.

AOL announced in August that it was looking for a new owner for its UK arm and said it hoped to have details finalised this autumn. The company was hoping to sell for around £1bn, but industry watchers say this is unlikely.

A fiercely competitive market has put pressure on prices and all the major players are feeling the pinch.

The paper also claims that Tiscali's loss-making UK business is attracting buyers. BT is rumoured to be one of the interested parties, but never comments on rumour and speculation. A spokesman added that there is always a lot of each.

AOL serves 2.2m customers in the UK, and Tiscali a further 1.2m. The two companies are third and fourth largest broadband suppliers respectively. ®

Update:

In related news, Time Warner has announced that it will sell AOL's French arm to Neuf Cegetel, the second largest fixed-line operator in France, for $365 million.

Under the terms of the deal, AOL will provide editorial content and will manage online ad sales for Neuf's internet portals.

Neuf Cegetel will take on the 500,000 or so AOL subscribers in France, and has promised to find jobs for 140 AOL employees.

The deal must be approved by the country's competition commission before it is completed.

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