CSC, the US supplier overseeing 60 per cent of the £12bn National Programme for NHS IT (NPfIT) says it is considering an offer for iSoft, its troubled software subcontractor on the project.

CSC has already guaranteed iSoft a certain amount of business under the NPfIT deals, and introduced a 'step-in' clause saying that CSC can take over development of the Lorenzo hospital administration software if iSoft is not performing adequately.

'CSC continues to review its options in light of this objective, and does not exclude the possibility of making an offer for iSoft. Should an offer be made, any consideration is likely to be solely in the form of cash,' the company said in a statement.

iSoft began legal action against CSC on Monday after the US company said it would block a takeover bid by Australian firm IBA Healthcare. But following talks with CSC yesterday the firm decided hold off on the action, further fuelling rumours of a bid from CSC.

As a prime contractor for the NHS contract, CSC has the last word in any change of control of iSoft, although both iSoft and IBA say that CSC gave its consent in April to proceed with a deal.

Gary Cohen, the executive chairman of IBA, says he and iSoft are due to hold talks with CSC in London today.