Shares in BT were down a smidgen today after weekend press speculation that the UK incumbent could be the takeover target of German giant Deutsche Telekom.

Reports suggested that Deutsche Telekom was prepping a £25bn bid for BT with rumours fuelled still further by both firms' reluctance to comment.

Now, though, The Telegraph quotes a source from Deutsche Telekom who describes the idea of a bid as "crackers" and that "members of the board would be horrified".

Analysts at Ovum are equally sceptical, describing talk of any takeover of BT by Deutsche Telekom as "unlikely".

Why? Well, analysts point out that the £25bn price tag is a bit steep - even for Deutsche Telekom - and they are concerned the firms might not actually be a very good fit.

Even if these obstacles can be overcome, there are still the regulatory hurdles that would need to be faced over such a marriage.

"In fact, we see few synergies arising from bolting together a German and a British fixed line operation," Ovum said. "Any potential opportunities for fixed-mobile convergent offerings by combining BT's UK fixed line network with T-Mobile UK are unconvincing."

Talk of a tie-up between the two firms bubbled to the surface recently after US investment group Blackstone took a five per cent stake in Deutsche Telekom.

At lunch, shares in BT were up 4.5p (two per cent) at 233.5p. ®

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