BRITISH Telecom said last night it has ended merger talks with Cable & Wireless, but it added that the possibility of working with C&W was still open.

"Our conclusion was that the risks [from a merger] at this stage outweighed the prospective opportunities," BT said.

"The possibility of BT and C&W working with each other, or with each other's subsidiary companies, to mutual benefit in other ways is still open," the telecommunications firm said.