Sept. 4 (Bloomberg) -- Deutsche Telekom AG has started talks with Vodafone Group Plc, France Telecom SA and Telefonica SA about selling its T-Mobile U.K. unit, the Financial Times reported, citing people familiar with the situation.

All three companies have expressed interest in the unit though talks are at a preliminary stage, the FT said. The recent rally in stock markets and signs of economic recovery have raised hopes that a sale may raise as much as 4 billion euros ($5.72 billion), a person briefed on Deutsche Telekom’s plans said, the FT reported.

A merger between T-Mobile U.K. and France Telecom’s Orange U.K. unit is being considered, the FT also said. Deutsche Telekom, Vodafone, France Telecom and Telefonica declined to comment, the FT reported.

To contact the reporter on this story: Ben Martin in London bmartin38@bloomberg.net.

Last Updated: September 3, 2009 19:47 EDT