Thus and Cable & Wireless (C&W) have clashed in a battle to buy fellow telco Energis, as both strive to compete better against industry leader BT.
Thus revealed on Monday morning that it had made an £800m bid for Energis, rivalling an earlier bid from C&W.
C&W is reported to be offering around £710m for Energis, which is the third-largest UK telecoms firm behind BT and C&W.
C&W's approach has been rejected by one group of Energis debt holders, who believe that the offer isn't attractive enough. With debts of around £700m, Energis' future lies in the hands of the investment banks, hedge funds and other bodies that hold Energis bonds and debts. C&W responded on Friday with a 'take it or leave it' statement claiming that its deal would die at 5pm Monday unless 75% of Energis debtholders had accepted it.
In response, Thus announced its own offer which Bill Allan, Thus chief executive, claimed was a credible offer that would help Thus grow to become the leading alternative to BT.
However, by mid-afternoon Monday it appeared that Thus's attempt to snatch away C&W's plan had failed. Chelys, the firm which owns Energis, issued a statement announced it was rejecting Thus's proposal, claiming it offered less value than C&W's offer.
"The board of Chelys carefully considered that proposal but rejected it for reasons of value, uncertainty and deliverability," the firm said.
Both C&W and Thus are offering a mixture of cash and company shares, but C&W's proposal is said to include more cash.