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Vodafone agrees to buy CWW for £1bn
23 April 2012
Cable & Wireless Worldwide decides to recommend Vodafone’s £1bn bid in favour of new CEO’s strategy
Cable & Wireless
The board of Cable & Wireless Worldwide has agreed to a £1.044bn takeover bid from Vodafone, only months after appointing Gavin Darby as CEO with the aim of refocusing the company on a new strategy.
A statement from the companies says that holders of 18.5% of shares are already in support of the move, which has to be referred to general meetings of both companies.
The decision means CWW has decided to drop what chairman John Barton called “a strategy to refocus the business on achieving sustainable cash generation and returns from capital invested” that Darby has developed since he was appointed at the end of November 2011.
Barton explained: “The offer from Vodafone announced today will enable shareholders to crystallise a value, in cash, that represents a significant premium to recent trading levels and avoid exposure to the risks inevitably presented by executing a medium-term improvement strategy.”
Vittorio Colao, CEO of Vodafone, commented: “The acquisition of Cable & Wireless Worldwide creates a leading integrated player in the enterprise segment of the UK communications market and brings attractive cost savings to our UK and international operations.”
CWW, split off from the now independent Cable & Wireless Communications in 2010, is essentially the old Energis enterprise communications company, with which it merged in a reverse takeover in 2005. It also has an extensive international submarine cable network, which is likely to be attractive to other companies, including Tata Communications, which dropped out of negotiations for CWW four days before the agreement with Vodafone. GTB
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