Shareholders Sue C&W 588436

Law firms of Fruchter & Twersky and Abraham & Associates file class action lawsuit against Cable & Wireless and some of its officers

February 5, 2003

2 Min Read

NEW YORK -- The law firms of Fruchter & Twersky LLP and Abraham & Associates announce that a class action lawsuit was filed on February 3, 2003 on behalf of purchasers of publicly traded securities of Cable & Wireless PLC ("Cable" or the "Company") (NYSE: CWP - News) between the period of August 6, 1999 and December 6, 2002, inclusive (the "Class Period") against Cable and certain of its officers and directors. Cable announced, in an August 6, 1999 press release that it had agreed to sell One 2 One, a British based mobile telecommunications operator, to Deutsche Telekom. The announced terms of the agreement detailed that Deutsche Telekom would pay 6.9 billion pounds sterling in cash for 100% of the equity ownership interest in One 2 One. Additionally, Deutsche Telekom would provide for the repayment of 237 million pounds of shareholder loans, and would assume nearly 1.5 billion pounds of third-party debt. The complaint alleges that those statements were materially false and misleading because they failed to reveal that an essential term of the One 2 One deal was a 1.5 billion pounds tax indemnification clause agreed to by Cable, and specifically, a trigger clause, involving a future downgrade of Cable's long-term debt rating below a predetermined level, which would trigger a 1.5 billion pounds cash commitment on behalf of Cable. Moody's investment service announced on December 6, 2002, that it would downgrade the long-term debt rating of Cable from Baa1 to Baa2. The Company then surprised the market in a press release that same day revealing that, as a result of the downgrade, the aforementioned "ratings trigger" was activated. The announcement resulted in a 40 percent decline in the price of Cable's ADRs, from a closing price of $3.90 per ADR on December 6, 2002, to a close at $2.33 per ADR on December 9, 2002, on uncommonly high trading volume. The Company filed a Form 6-K with the SEC on December 9, 2002 including a statement concerning the tax indemnification "ratings trigger" clause. If you purchased or otherwise acquired the publicly traded securities of Cable during the Class Period, and either lost money on the transaction or still hold the securities, you may wish to join in the action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than February 24, 2003. In order to serve as lead plaintiff, however, you must meet certain legal requirements. You do not need to seek appointment as a lead plaintiff in order to share in any recovery. Under certain circumstances, one or more class members may together serve as "lead plaintiff." You may retain Fruchter & Twersky LLP, Abraham & Associates, or other counsel of your choice, to serve as your counsel in this action.

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