Deutsche Telekom gained 1.3% after the German business daily Handelsblatt report. Orange shares were little changed as it said "there are no ideas or discussions going on".
Telecoms were the top performing European sub-sector with their more than 1% rise.
The pan-European STOXX 600 index finished 0.3% higher at a new 4-four peak as comments from U.S. President Donald Trump on Tuesday that Washington was in the "final throes" of work on a deal continued to buoy the sentiment.
U.S. stock indexes also hit record highs on Wednesday.
"Trump's comments has definitely been a bit of a boost to European markets," said Simona Gambarini, markets economist at Capital Economics.
"The move has so far been quiet because we have heard similar comments before and they haven't really translated into anything more concrete and people are still a bit sceptical about trade."
Trade optimism has helped the benchmark index rise about 1.5% in a relatively uneventful week with a U.S. Thanksgiving holiday on Thursday. Volumes on the STOXX 600 index were well below long-term daily averages on Wednesday.
The benchmark European index is expected to hit a record high by the end of next year, a Reuters poll showed, underpinned by loose monetary policy and hopes of an orderly Brexit.
Among major country indexes, Germany's trade-reliant was leading the charge with its 0.4% rise, shrugging off weak data out of China earlier in the day. Italy's FTMIB slipped after two days of gains and France's CAC 40 was marginally lower.
The biggest boost to benchmark index were shares of British American Tobacco, up 3% after it raised its full-year revenue forecast, even as it said a slowdown in the U.S. vaping market would lead to lower revenue growth in its vaping arm.
Sweden's SEB gained more than 3% as said it saw no need for further action after a television report said accounts at the bank had links to suspected money laundering in Estonia.
Engineering group Andritz suffered their sharpest decline in nearly seven months after the Austrian firm forecast next year's profit to be similar to 2019, despite expecting a significant increase in sales.
By Medha Singh