BT and Virgin are fighting it out to buy communications business Pipex, which is valued at £407 million.

BT recently secured regulatory permission for a prospective purchase, even though it faced a much smaller price for the business when it considered buying it a year ago.

As well as Virgin and BT, Carphone Warehouse, BSkyB, Tiscali and Orange are all thought to be interested in Pipex.

Pipex provides broadband services, including its branded service Freedom2Surf, to more than 570,000 customers.

Despite the likely high cost of converting Pipex customers to home services, bidders are keen to expand their customer base as competition between the key broadband providers grows fiercer.

Analysts say the market will eventually be honed down to three or four major players. Virgin currently has 3.3 million internet customers, making it the largest internet provider in the country.

Sardinia based Tiscali has two million UK based broadband customers.



Monday, 26th March 2007

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