BT Group plc (NYSE: BT; London: BTA)'s stock crept up nearly 1.5 percent Thursday as speculation hit London's trading floors that German giant Deutsche Telekom AG (NYSE: DT) is lining up a takeover bid for the British incumbent.

BT's share price was also helped by news that, in partnership with Sky , the carrier has won the rights to show, from August 2007, time-delayed English Premiership League soccer games as part of its IPTV service, BT Vision, which is set to launch later this year. (See BT Wins Soccer Deal.)

But it was the link with Germany's incumbent, which only weeks ago announced its intention to "play an active role in the European consolidation process" and remain Europe's biggest carrier, that caught the eye. (See DT Plans Acquisitions.)

The speculation was prompted by a report in German magazine Wirtschaftwoche that DT is considering such a bid. U.K. newspaper The Independent reported that traders in the City of London believe such a move is possible, but that DT would have to offer up to 300 pence per share, or £25 billion ($46.8 billion) in total, to stand a chance.

But DT, which, it is suggested, is primarily interested in BT's international assets, wouldn't have to find all that money itself. The speculators reckon The Blackstone Group would step in to buy the parts of BT that DT either doesn't want, or wouldn't be allowed to own for regulatory reasons. (See M&A Activities Firm Up BT Global and BT Expands Asia Pac Network.)

Why Blackstone? Because it now owns a 4.5 percent stake in DT after buying a large chunk of shares from the German government in April, a deal welcomed by the carrier. (See Eurobites: No Let-Up on Euro M&A and DT Welcomes Blackstone.)

BT, in the early stages of its next generation network transformation, has been linked to potential private equity interest in the past few months, and just reported healthier than expected annual results that pumped its share price. (See BT Bid Fever Heats Up London, Upbeat BT Tweaks Critics, Rivals, and BT Says 21CN Deadline Hasn't Moved.)

BT's share price is up again slightly today, by nearly 1 percent to 229 pence.

Telefónica Holds Fire
Spanish giant Telefónica SA (NYSE: TEF) told investors this morning it won't be making any more major acquisitions in the next 18 months after a spell of major takeovers. (See Telefónica Swoops In on O2 and Eurobites: Incumbents Splash Their Cash.)

The carrier said it would limit its M&A budget to €1.5 billion ($1.9 billion) between now and the end of 2007, and wouldn't issue any new shares to buy other companies, so quelling any suggestions it might pounce on Dutch incumbent KPN Telecom NV (NYSE: KPN). (See Dutch Put KPN on the Block.)

That promise, news of two interim dividends of €0.30 in November 2006 and early in 2007, and a strategic target for 2009 to double its earnings per share (EPS) and dividend from 2005's €0.91 and €0.50 respectively, sent Telefónica's share price up by €0.32, more than 2.5 percent, to €12.52 on the Madrid exchange today.

Eircom Ends Takeover Saga
After months of deliberation by both sides, Irish incumbent eir has accepted a takeover bid from Australian private equity firm Babcock & Brown that values the operator at €2.41 billion ($3.1 billion). The carrier had previously held merger talks with fellow European incumbent Swisscom AG (NYSE: SCM). (See Eircom Accepts Offer and Swisscom Ends Eircom Talks.)

KPN Lands Enertel
KPN made another small purchase this week when it acquired Dutch operator Enertel for €10 million ($12.8 million) from private equity group Greenfield Capital Partners . (See KPN Acquires Enertel.)

For its money, KPN gets Enertel's leased line, data center and 200 public WLAN access sites to add to its growing tally of hotspots. (See Euro Incumbents Transform.)

Perhaps more interesting is what KPN didn't get. The incumbent noted that the acquisition didn't include "Enertel’s WLL license and its related business which will remain at Greenfield Capital who will continue to run it."

That refers to the WiMax business Enertel set up earlier this year in league with Intel Capital . That business will develop the operator's existing service and test out new technologies. (See Intel Funds Two, Proxim Pumps 3.5Ghz WiMax, and Aperto Goes Dutch.)

— Ray Le Maistre, International News Editor, Light Reading