Melbourne billionaire Lindsay Fox has lobbed a bold proposal to take control of the ATM networks owned and operated by the four major banks.Fox's Armaguard cash management arm has approached the chief executives of each of the major banks with an offer to merge their respective ATM fleets.The proposal, stumped up by Fox in late October, came after Commonwealth Bank previously rejected several other proposals to unify the ATM operations of the country's largest banks.Fox has won strong backing from ANZ for his offer and the bank is urging its rivals to do a deal.Banking Day was told by several industry sources close to the negotiations that NAB and Westpac were open to entering a deal with Armaguard but that CBA had raised several concerns about some conditions attached to Fox's offer.Fox originally wanted to take a controlling stake in a merged ATM utility company that would manage the unified fleet under a stand-alone brand.However, following objections from CBA, Fox is now asking to take a 50 per cent stake in the business, leaving the banks to share in the other half of the business.It is believed that Armaguard and the banks have not reached agreement on how profit-sharing arrangements would operate.Under the proposed deal, Armaguard would take charge of managing the cash and logistics requirements of the merged entity's ATM fleet.It would also assume responsibility for maintenance and technical development of the fleet through a specialist subsidiary, Integrated Technology Services(ITS).ITS is already the largest ATM maintenance business in Australia, servicing more than 12,000 payments machines currently owned by the banks.Banks stand to harvest big cost savings running into the hundreds of millions by merging their ATM services, streamlining their fleets and consolidating maintenance functions with a single provider.However, CBA remains a stumbling block for getting a deal with Armaguard over the line. Senior CBA executives have opposed the idea of a utility in the past on the grounds that the bank would have to relinquish a perceived competitive advantage in ATM distribution.CBA is the largest ATM operator among the banks, with an extensive presence in regional parts of the country that is unmatched by any of its rivals.An industry-wide utility would enable the banks to rationalise ATMs, especially in high-traffic retail precincts where the majors each operate machines in close proximity.But the proposal could face opposition from local politicians and consumer advocates worried that a utility would lead to heavy rationalisation of services in rural areas.The formation of a utility would also diminish competition in the provision of cash across Australia, which might require specific undertakings to be given to the Australian Competition and Consumer Commission.In November the head of the Reserve Bank's payments department, Tony Richards, told a conference in Sydney that the RBA would not stand in the way of an industry move to set up an ATM utility."Policy concerns could arise if there was a significant decline in ATM coverage that made it difficult for people to access cash, particularly in remote or regional locations," Richards