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. Last Updated: 07/27/2016

BT Outbids Vodafone

MADRID, Spain -- British Telecommunications PLC has trumped a pounds 4.5 billion ($7.3 billion) bid by archrival Vodafone AirTouch PLC in a battle for a key stake in Spain's No. 2 cell phone group, Airtel, a source said.

A source at Spain's biggest bank, Banco Santander Central Hispano, which is the leading shareholder in Airtel with a 30.45 percent holding, said Friday in Madrid that BT had offered a share swap deal that outstripped that of Vodafone.

"The offer is higher that Vodafone's," the source said, declining to put a value on the bid. But the source noted that under BT's offer, BSCH would take a 4.5 percent to 5 percent stake in Britain's biggest fixed-line carrier.

BT and Vodafone, two of Europe's most aggressive telecoms investors, which each hold Airtel stakes, declined to comment on a tussle that could see them paying dearly to raise their holdings in one of Europe's fastest-growing mobile markets.