Telewest Communications, owner of Bradford-based Yorkshire Cable, has confirmed it is in merger talks with Cable & Wireless Communications.

The talks between the two cable TV and telephone companies had been rumoured to be underway since late last week and prompted sharp rises in share prices yesterday.

Telewest, which took over Yorkshire Cable last year, is believed to have been behind the decision to close Yorkshire Cable's call centre at its Laisterdyke headquarters and build a multi-million pound state-of-the-art call centre in Sheffield - with job losses in Bradford.

The companies issued a statement last night after the stock market closed confirming the talks, which they described as being "at an extremely early stage". They "may include among other things the transfer of various businesses of CWC and Telewest," it added.

Cable & Wireless owns a 53 per cent stake in CWC and the talks are thought to centre on it selling off the UK residential cable business of CWC to Telewest.

The cable industry has seen a series of consolidations over the last year which have left the UK industry dominated by three companies. CWC is the largest, then Telewest and NTL.

The announcement of talks comes just six weeks after Cable & Wireless appointed Graham Wallace chief executive. Mr Wallace was previously chief executive of CWC, where he was replaced by Greg Clarke.

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