LONDON (Reuters) -- Hutchison Whampoa Ltd., owner of Britain’s fourth-largest mobile operator Three, is in talks with Telefonica SA about buying its O2 network, the Sunday Times reported, citing unnamed sources in the City financial district. The price could be as high as 9 billion pounds ($13.63 billion), although discussions are at an early stage and there is no certainty a deal will be reached, the newspaper said.

O2, acquired by Spain’s Telefonica in early 2006, is second in the British mobile market with about 22 million subscribers.

Reuters reported in November that Hutchison was working with an advisory boutique on a deal for either O2 or rival network EE, which is owned by Deutsche Telekom AG and Orange SA.

Former state telecommunications provider BT has since entered exclusive talks to purchase EE.

Neither Hutchison nor Telefonica were immediately available to comment Sunday.

($1 = 0.6602 pounds)

(Reporting by William James; Editing by David Goodman)