Vodafone and O2-parent Telefonica have both begun due diligence on HanseNet, the German ISP owned by Telecom Italia, reports UK newspaper The Telegraph without citing sources. According to the report, bidders have until 24 April to submit non-binding offers. Other rumoured bidders include United Internet and Turkcell. Analysts estimate the business to be worth around £1 billion but note that bids could be considerably lower in the current financial climate. HanseNet – which trades under the ‘Alice’ brand – has around 2.3 million customers.

The ISP is understood to be one of Telecom Italia’s assets that the debt-laden Italian incumbent is looking to divest this year. Telecom Italia announced in December it was looking to raise as much as EUR3 billion by selling assets it deems “non-core.” Vodafone’s interest is reportedly linked to its existing German fixed-line subsidiary, Arcor, which it recently rebranded as Vodafone. Meanwhile, Telefonica already has a network-sharing deal in place with HanseNet (via O2 Germany) and owns 10 percent of Telecom Italia. However, both operators declined to comment on the story. Meanwhile, Vodafone’s German ambitions have been strengthened with news that the operator said this week it is to build a research and development centre for IPTV, video and home entertainment products and services in Eschborn, Germany.