Tata Communications (TCL) has decided not to make a bid for Cable & Wireless Worldwide (C&WW) after having failed to reach an agreement on offer price with CWW.

This leaves Vodafone Group, the world's largest mobile services company as the single bidder for Britain's network operator.

Tata Communications said in a filing with the Mumbai and London stock exchanges, ''TCL today confirms that it has been unable to reach an agreement with CWW on an offer price and therefore confirms that it does not intend to make an offer for CWW.''

According to the new UK Takeover Panel rules, TCL and Vodafone had until 1600 GMT today to indicate whether they planned to make an offer for C&WW. Vodafone, which has also said it was weighing an offer, is yet to respond (See: Tata Comm, Vodafone deadline for C&WW bid extended).

However, TCL has reserved the right to make an offer after six months, should Vodafone not come up with a firm offer.

TCL, which had secured a $2-billion term loan from a consortium of four or five banks to fund the acquisition, was expected to place a bid of around 40-45 pence per share for CWW, according to analysts.

C&W closed at 37 pence yesterday, after rising by nearly 80 per cent since Vodafone first made its interest public in mid-February of acquiring the Bracknell, Berkshire-based company. CWW was yesterday valued at around £1 billion ($1.6 billion).

Troubled CWW's market value has declined over 70 per cent in the past 24 months, broadly reflecting the woes of the global telecom sector, but making it possibly the least expensive target in the industry.

CWW has issued a string of profit warnings since its March 2010 demerger from Cable & Wireless Communications and has found it difficult to compete against its larger rivals British Telecom, AT&T, Telefónica and Vodafone.

The deal would not have economic sense for TCL since CWW has accumulated £5.2 billion in losses in recent years, but gives it a tax saving of around £1.2 billion over a number of years.

Vodafone already operates in the UK and could reap this cost savings, but not TCL, since its business is not based in Britain.

Vodafone pays around £200 million annually to BT group for offloading its massive mobile traffic to BT's fixed network, and pays CWW for backhaul services, so any offer can bring it saving on the purchase price, say analysts.

CWW owns the UK's biggest fibre network dedicated to business users of telecommunications and has an international cable network spanning approximately 425,000km in length. It reaches across the Atlantic Ocean, through Europe and on to India and throughout Asia. In conjunction with satellite, C&WW connects every continent and more than 150 countries.

About one-third of its £2.2 billion revenues come from carrying internet and voice traffic for other telecom companies.

CWW specialises in providing communication networks and services to large corporates, governments, carrier customers and resellers. Its services include managed voice, data and IP-based services and applications across the UK, Asia Pacific, India, Middle East & Africa, Continental Europe and North America.

The company posted net profit of $331.7 million in 2011 on revenues of $3.6 billion.

After its demerger, CWW's operational performance has been a concern to its shareholders. Due to a cut in public sector spending and stiff competition, the company has issued a string of profit warnings and last reported a pre-tax loss of £433 million for the six months end September 2011.