Australia's No. 2 telephone company, Cable & Wireless Optus, confirmed on Monday morning it has received a takeover offer from Asian telecommunications giant Singapore Telecommunications Ltd (SingTel).

The SingTel offer follows months of speculation and the dropping out of the other two bidders - Telecom New Zealand and UK-based Vodafone. If the takeover is successful it will mean the exit of UK-based Cable & Wireless Plc from its Australian operations. That company earlier signalled its desire to sell its stake in Optus so that it could concentrate on telecom businesses in Europe, Japan and the US. SingTel will make an offer of up to A$4.57 (US$2.26) per Optus share. Optus said this values its equity at up to A$17.2 billion ($8.49 billion). SingTel had earlier raised a S$1 billion ($557.72 million) through a bond issue and has significant cash reserves. The takeover would realize the company's aim of becoming a pan-Asian player and make up for its failed bid for Hongkong Telecom. For Optus, the deal also turns it into a regional player - an area in which it has failed to keep up with local rival Telstra. However, some analysts and shareholders in Singapore have questioned the returns from an Optus takeover. Concern over returns on investment was the reason for Vodafone pulling out of the running. The takeover offer has to receive more than 50 percent acceptance and approval by Australia's Foreign Investment Review Board to go ahead.