Vodafone bids £1bn for Cable & Wireless
Vodafone has offered £1 billion for Cable & Wireless Worldwide (CWW), as it looks to use the fibre network to cut mobile data costs.
Vodafone has been considering such a bid since February, and has now decided to proceed, potentially making it the second largest telecoms firm in the UK after BT.
CWW has issued three profit warnings – and had three CEOs – since splitting from Cable & Wireless in 2010, with the rest of the company now known as Cable & Wireless Communications.
There is a good overlap between Cable & Wireless’ fibre network and our base stations
Vodafone’s CEO Vittorio Colao said CWW’s 20,500km of fibre in the UK would give his firm a needed backhaul boost. “There is a good overlap between Cable & Wireless’ fibre network and our base stations which will significantly reduce the cost to us of managing the growth in data traffic,” Colao said in a conference call, according to Reuters.
Colao added that the bid would double the size of Vodafone’s enterprise business, allowing it to offer bundled services to corporate customers, and bring “attractive cost savings” to its UK operations.
Vodafone said it expected the merger would result in job losses, but the exact number wasn’t yet decided. The deal has been approved by the CWW board, but is still subject to a shareholder vote – and one major shareholder has already said the price isn’t high enough.