Mobile phone giant Vodafone said on Monday it was considering an offer for Cable & Wireless Worldwide, the global telecoms company set up in the 1860s to run the British empire's communications network.
The news sent CWW's share price surging by almost a third in morning deals on the London stock market.
"Vodafone regularly reviews opportunities in the sector and confirms that it is in the very early stages of evaluating the merits of a potential offer for CWW," it said in a statement issued in response to weekend press speculation.
Vodafone, with operations around the world, said there was "no certainty that an offer will be made nor as to the terms on which any offer might be made".
"Any offer, if made, will be in cash but Vodafone reserves the right to change the (terms) ... A further announcement will be made in due course, if appropriate."
Under British regulations, Vodafone added that it must make its intentions clear by March 12. The group had earlier given the date as March 13.
In response to news of a potential takeover, CWW shares rocketed 28.58 percent to 25.39 pence in mid-morning deals. Vodafone stock meanwhile increased by 0.87 percent to 174.15 pence.
The Sunday Times had reported over the weekend that Vodafone would need about £700 million (836 million euros, $1.14 billion) to purchase C&W, which is also thought to be in the sights of private equity firm Apax. The weekly newspaper did not cite its source.
Cable & Wireless was involved from the start in the laying of submarine cables around the world which linked the outposts of the British empire as it expanded in the 19th century.