Formus Communications, parent of fixed wireless operator Formus Broadband, has pulled its proposed Nasdaq flotation and is not prepared to pay substantial amounts for licences in the UK broadband auction which begins tomorrow.

At the inception of the firm's Irish service in Dublin yesterday, Mr Bernie Dvorak, chief executive of Formus Communications, said the company would withdraw its filing for an initial public offering within the next few weeks.

Mr Dvorak blamed uncertain market conditions for the decision and indicated the company might try to float in the first or second quarter of next year, subject to market conditions.

This is the second time Formus has postponed an IPO. It delayed its Nasdaq debut almost a year ago following the resignation of its former chief executive officer, Mr Osmo A. Hautanen.

Mr Dvorak said the company would have to seeking funding from the private equity market further to expand the business in Europe. He said Formus had raised $450 million in the past 3 1/2 years from private sources.

Formus has fixed wireless licences in eight countries throughout Europe including Ireland, Germany, Poland, Finland and Norway. It will take part in the UK auction for wireless licences which begins tomorrow.

Mr Dvorak said this would affect the price it was prepared to pay for broadband fixed wireless licences in the UK auction.

The auction for broadband fixed wireless licences is forecast to raise $1.42 billion (€1.65 billion) for the British exchequer. But UK analysts said yesterday the proceeds could be greater than first anticipated.

Ten telecoms operators will compete for 42 licences in 14 regions across the UK.

Some analysts believe competition will be strong as companies seek to obtain wireless licences to avoid delays in obtaining cable and fibre.

Eircom and Chorus have pre-qualified to take part in the UK auction.