BT in bid for O2. And EE

btlogoGiant telecomms firm BT confirmed it is in preliminary talks to buy O2 UK from Spanish giant Telefonica.

That’s something of an irony because BT spun off its Cellnet unit in 2002. It then renamed itself as O2 and sold itself to Telefonica for over £17 billion in 2005.

Telefonica confirmed a deal was in the cards and in a prepared statement said that it was in talks with BT. But it warned that “there is no certainty that a transaction will take place”.

The deal, however, is likely to be just for O2 UK, and may cost BT as much as £6 billion.  But, Reuters reports, BT is also talking to EE in the UK.

In a statement, BT agreed with Telefonica that talks were at a preliminary stage.

But that hasn’t stopped the price of BT’s shares shooting up on the Stock Exchange this morning.