Vodafone has turned up the heat on the battle for AT&T Wireless by refusing to rule itself out of the bidding war for the giant US mobile phone operator.

Speaking a day after AT&T advisers Merrill Lynch set a bid deadline of February 13, Arun Sarin, chief executive of Vodafone, said: "We're watching developments as they occur in the US." He added: "Whatever we do or do not do will be always with our shareholders in mind."