Light Reading
After months of due diligence, Vodafone offers more than £1B for enterprise services and international capacity player C&W Worldwide

Vodafone Offers £1B for C&W Worldwide

Ray Le Maistre
4/23/2012
50%
50%

More than two months after it first admitted its interest, Vodafone Group plc (NYSE: VOD) has made an official cash bid for enterprise services and international capacity operator Cable & Wireless Worldwide plc (London: CW) worth £1.044 billion (US$1.68 billion), an offer that has been accepted and recommended by the C&W Worldwide board.

Vodafone is offering 38 pence per C&W Worldwide share, a 92 percent premium over the price on 10 February, the last day before the global services giant announced it was considering a takeover bid. (See Euronews: Vodafone Eyes M&A Opportunity.)

Since then others have evaluated C&W Worldwide, but Vodafone is currently the only bidder. (See Euronews: Tata Considers C&WW Bid.)

The news sent C&W Worldwide's share price up by more than 16 percent to 37.25 pence in early Monday morning trading on the London Stock Exchange.

Vodafone believes C&W Worldwide's operations will help it strengthen its enterprise business in the U.K. and provide it with valuable network assets in the U.K. and internationally that will help reduce its reliance on others' infrastructure and thus help reduce its costs. C&W Worldwide has about 6,000 enterprise and carrier customers globally to which it provides a range of voice and data services, including IP, Ethernet and cloud services. (See C&W Worldwide Wins Cloud Services Deal , C&W Worldwide Bolsters Smart Grid Offer , C&W Worldwide Boasts IPv6 Heritage and C&W Worldwide Extends Videoconferencing.)

In its official bid note, Vodafone notes that C&W Worldwide's U.K. fiber network -- 20,500 kilometers in length and reaching more than 400 cities and towns -- "fits well with the location of Vodafone Group’s UK base stations. As the demand for mobile data continues to grow strongly, the CWW fibre network can provide fast backhaul of data traffic at considerably lower cost compared to prevailing market rates for leased capacity. Cost savings can also be achieved from combining UK procurement and rationalizing network, IT and administrative functions." About 75 percent of C&W Worldwide's revenues are generated in the U.K.

Outside the U.K., the combination of Vodafone Global Enterprise and C&W Worldwide's network -- 425,000 kilometers in length with 127 global points of presence in 35 countries -- would "increase the scope of services Vodafone Group can offer enterprise customers. CWW’s extensive international network and high traffic volumes give it a favourable peering status for IP transit with other operators. Exploiting CWW’s international network capacity in servicing Vodafone Group’s international IP traffic requirements will generate significant cost efficiencies. CWW will also be able to handle part of Vodafone Group’s international traffic that is currently carried by other operators."

C&W Worldwide generated revenues of £2.26 billion ($3.64 billion) and an operating profit of £153 million ($246 million) in the financial year to March 31 2011 but has since issued profit warnings, cut costs, changed its CEO twice and been focused on finding a buyer. (See C&WW Provides H1 Update, C&W Worldwide Names New CEO, Pluthero Back in C&W Hot Seat and Euronews: C&W Worldwide Mulls Asset Sale.)

In the six months to 30 September 2011, C&W Worldwide generated revenues of £1.07 billion ($1.72 billion), down 4.5 percent year-on-year, and reported an operating profit (before one-time costs) of £50 million ($80.4 million), down 35 percent from a year earlier.

Vodafone expects that, should the deal be completed, some of C&W Worldwide's 6,000 staff would be made redundant but said that the number of staff and locations affected have not yet been identified.

— Ray Le Maistre, International Managing Editor, Light Reading

(1)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Michelle Donegan
50%
50%
Michelle Donegan,
User Rank: Light Beer
12/5/2012 | 5:35:32 PM
re: Vodafone Offers £1B for C&W Worldwide


Vodafone says with acquisition of CW&W, it  will be the second largest service provider in the UK, after BT, by revenue. It's now fourth largest.


As for Vodafone's partnership with BT, CEO Vittorio Colao said on the analyst call this morning that he didn't see any reason why that partnership should not continue.

Educational Resources
sponsor supplied content
Educational Resources Archive
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Documentaries
The Rise of Virtual CPE

1|27|15   |   01:38   |   (1) comment


As NFV strategies evolve from tests and trials to production telco networks, expect to hear a lot about virtual CPE (customer premises equipment) rollouts during 2015.
LRTV Documentaries
Optical Is Hot in 2015

1|23|15   |   01:56   |   (2) comments


Optical comms technology underpins the whole communications sector and there are some really hot trends set for 2015.
LRTV Custom TV
Policy Control in the Fast Lane

1|22|15   |   2:57   |   (0) comments


What's making policy control strategic in 2015 and beyond? Amdocs talks with Heavy Reading's Graham Finnie about the key factors driving change in the data services landscape. Find out what his policy management research reveals about the road ahead for policy control – and sign up for
LRTV Documentaries
Highlights From the 2020 Vision Executive Summit

1|21|15   |   4:33   |   (2) comments


In December 2014, Light Reading brought together telecom executives in Reykjavik, Iceland to discuss their vision for high-capacity networks through the end of the decade. The intimate, interactive meeting was set against the backdrop of Iceland's spectacular natural beauty. As one of the event's founding sponsors, Cisco's Doug Webster shared his company's ...
LRTV Huawei Video Resource Center
Huawei Pay-TV Partner Harmonic, Helping Carriers Accelerate 4K Video Deployment with Huawei

1|20|15   |   5:42   |   (1) comment


At IBC, Peter Alexander, Senior Vice President & CMO at Harmonic, speaks about the growing interest in pay-TV service and its branching into multiple devices.
LRTV Huawei Video Resource Center
Sony Marketing Director Olivier Bovis Discusses the Outlook for 4K and Cooperation With Huawei at IBC 2014

1|20|15   |   6:50   |   (0) comments


At IBC, Olivier Bovis, Marketing Director of Sony, speaks about the coming of the 4K era.
LRTV Huawei Video Resource Center
Huawei Pay-TV Partner Envivio, Helping Carriers Accelerate 4K Video Deployment

1|20|15   |   2:57   |   (0) comments


At IBC, Olivier Bovis, Marketing Director of Sony, speaks about the coming of the 4K era.
LRTV Huawei Video Resource Center
Pay-TV's Networked Future

1|20|15   |   6:29   |   (0) comments


At IBC, Jeff Heynen, Principal Analyst at Infonetics, speaks about the future of the pay-TV industry and its transition.
LRTV Huawei Video Resource Center
Jeff Heynen: Distributed Access Will Help MSOs Compete in the Future

1|20|15   |   2:26   |   (0) comments


At IBC, Jeff Heynen, Principal Analyst at Infonetics, speaks about moving to distributed access and the future trend of cable business.
LRTV Interviews
Cisco Talks Transformation

1|20|15   |   13:02   |   (0) comments


In December 2014, Steve Saunders sat down with Cisco VP of Products & Solutions Marketing Doug Webster at Light Reading's 2020 Vision executive summit in Reykjavik, Iceland. They spoke about Cisco's approach to network virtualization as well as how service providers can begin to monetize high-capacity networks through the end of the decade.
LRTV Interviews
Bob Wilson, Arsenal Legend: The Light Reading Interview

1|16|15   |   35:36   |   (3) comments


Arsenal goalkeeping legend Bob Wilson was Light Reading's guest interviewee at the 2020 Vision Executive Summit in December. See what the former soccer star and sports broadcaster had to say when he took to the stage in Iceland.
LRTV Custom TV
What MEF Third Network Initiative Means for SDN & NFV

1|14|15   |   6:13   |   (0) comments


Vitesse Semiconductor CTO Martin Nuss discusses the importance of the MEF Third Network initiative and why it's good news for SDN/NFV industry initiatives.
Upcoming Live Events
February 5, 2015, Washington, DC
February 19, 2015, The Fairmont San Jose, San Jose, CA
March 17, 2015, The Cable Center, Denver, CO
April 14, 2015, The Westin Times Square, New York City, NY
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
September 9-10, 2015, The Westin Galleria Dallas, Dallas, TX
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
November 11-12, 2015, The Westin Peachtree Plaza, Atlanta, GA
December 1, 2015, The Westin Times Square, New York City
December 2-3, 2015, The Westin Times Square, New York City
Infographics
Hot Topics
BlackBerry Wants Net Neutrality Protection – That's Just Sad
Mitch Wagner, West Coast Bureau Chief, Light Reading, 1/22/2015
FiOS Picks Up Pace Again
Alan Breznick, Cable/Video Practice Leader, 1/22/2015
Verizon Ready for Google MVNO Challenge
Dan Jones, Mobile Editor, 1/22/2015
Indiana Carrier Takes Fiber to the Farm
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 1/22/2015
Cablevision's New WiFi Try – Freewheeling Enough?
Mari Silbey, Independent Technology Editor, 1/26/2015
Like Us on Facebook
Twitter Feed
Webinar Archive