The Irish telecom is this week expected to ask Babcock & Brown Capital to submit an indicative bid before it offers its books for due diligence.

Babcock, the Australian-based investment house, has steadily been building up its stake in Eircom over the last number of weeks. It now owns 28.8% in the company and needs to reach 29.9% before it triggers a mandatory bid.

Latest rumours have suggested that Eircom is now attracting the interest of a second bidder - Esat founder and former Eircom suitor Denis O'Brien.