Smart Telecom has pulled out of the battle to buy mobile phone company Meteor, leaving Eircom as the only major contender left in the race.
Smart Telecom pulled out as the bidding war saw the price soar. Irish entrepreneur Denis O'Brien withdrew his bid earlier this month.
Eircom will be able to raise substantial funds for the purchase through a share issue. If it purchases Meteor, the company will be re-entering the mobile phone sector it left in 2001 with the sale of Eircell.
Smart Telecom said it withdrew from the bidding process after an intensive review. The company said it had gone into a partnership with Virgin Mobile to put in place a financial package including banking, private investors and proposed strategic partner funds to pursue the purchase.
"The boards of both Smart Telecom and Virgin Mobile concluded that, at the value being attributed to the business, and in the absence of sufficient due diligence material being made available to prospective bidders, a transaction was not in the best interests of our respective companies and shareholders," a company statement said.
Smart Telecom said it would now consider pursuing other commercial opportunities within the Irish market.