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Vodafone could still be eyeing up a multi-billion pound bid for cable broadband giant Liberty Global, an influential broker has claimed.

As reported by the Telegraph, Bank of America Merrill Lynch (BoA) has told clients to prepare for an acquisition attempt on Virgin Media's US-based parent company.

Rumours of a bid for Liberty Global have been circulating for some time, as Vodafone looks to develop a fixed-line offering.

Vittorio Colao, Vodafone's Chief Executive, poured cold water on these suggestions in December, claiming that, even if Liberty Global was available, the price would be too high.

But BoA is not at all convinced. It believes there is scope for a potential deal, particularly as Vodafone is desperate to increase its fixed-line holdings.

The broker said Liberty Global would be "an obvious fit" in this regard, although it said any takeover would be a "financially brave decision".

BoA added that Vodafone may look to capitalise on its strong share price by making a move for the cable operator "sooner rather than later".

"Right now, low interest rates and telco valuation highs mean that funding conditions are optimum," it added.

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