Vodafone is licking its lips on the prospects of creating UK's No 1 telecom group by buying comparatively small player in the market, T-Mobile UK.

T-Mobile, which enjoys only 15 % share of market as compared with Vodafone's 25 per cent, is valued between £2.5 billion and £3.4 billion.

T-Mobile UK is set for sale by its owner, Deutsche Telekom.

Deutsche Telekom is being advised on its options by JPMorgan. A joint venture or an absolute acquisition is among the options to consider.

List of major mobile operators in the UK, includes: O2, which is owned by Spain's Telefónica with 27% of market share, Vodafone with 25%, France Telecom's Orange enjoys 22%, T-Mobile 15% and 3, the operator owned by Hutchison Whampoa possesses 8% of the market share.

Vodafone's chief executive, Vittorio Colao had said earlier that the company was ready for the first time to play a dynamic part in consolidation between operators. Mr. Sinclair, a big shot at T-Mobile, said, "Vodafone's message remains that it is ready to participate in consolidation, as per Australia."

Vodafone, which is the world's largest operator, announced fresh plans for costcutting last month as it had to go in for writedowns worth £6 billion, which in turn slashed its full-year profits to £3.08 billion.

Newbury based Vodafone said that the move was not financially motivated In the recent trading, Vodafone shares closed at 116p.