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C&W Worldwide Hires Advisers Ahead of Potential Takeover Bid

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Vodafone Says It’s Evaluating Possible C&W Worldwide Offer
A Vodafone employee opens the doors of the company's store at Westfield shopping centre in London, U.K. Photographer: Chris Ratcliffe/Bloomberg

Feb. 13 (Bloomberg) -- Cable & Wireless Worldwide Plc, which jumped 45 percent in London trading after Vodafone Group Plc said it’s evaluating a potential bid, hired NM Rothschild & Sons Ltd. and Barclays Capital as advisers before any approach.

Any offer for the British fiber-network operator will likely be in cash, Vodafone, the world’s largest mobile-phone company, said today. Cable & Wireless, with a market value of 783 million pounds ($1.2 billion) after today’s gains, said separately that it noted the approach.

Cable & Wireless, which has replaced two chief executive officers since June and has assets ranging from the largest British core fiber network to an overseas enterprise unit, previously rejected a bid for part of the company. Newbury, England-based Vodafone lacks a core fixed-line network in the U.K., needed to carry surging data traffic.

“We would view an offer from Vodafone as a possibility rather than a probability but given the assets you can understand why they and others are running the rule,” Guy Peddy, an analyst at Macquarie in London, said via phone. “Cable & Wireless has previously said there would be a lot of re-engineering to separate the business into parts. It’s not impossible but it does require work.”

Vodafone said it’s not certain that an offer will be made.

Cable & Wireless Worldwide rose 8.79 pence to close at a three-month high of 28.54 pence. Vodafone added 1 percent to 174.40 pence. The operator has until March 12 to decide whether to make a formal offer.

Revamp

Vodafone may offer 700 million pounds while Apax Partners LLP may also consider a purchase, the Sunday Times reported yesterday.

Apax’s spokesmen didn’t respond to calls seeking comment.

Cable & Wireless Worldwide, which separated from its parent company in 2010, is revamping its business after CEO Jim Marsh and his successor John Pluthero stepped down last year. Its shares slumped 74 percent in the 12 months through Feb. 10. Gavin Darby, who was appointed CEO in November, previously headed Vodafone’s U.K. business and later oversaw its U.S., Africa, India and China operations.

While Cable & Wireless Worldwide assets are “particularly unattractive,” U.K. mobile operators such as Vodafone and Telefonica SA’s O2 could make more use of its network infrastructure, Mark James, an analyst at Liberum Capital in London, said in November.

Cable & Wireless Worldwide said in June it “considered and rejected” an approach for its global business division. Pacnet Ltd. CEO Bill Barney said on Sept. 14 that operator of undersea phone and Internet cables in Asia looked at Cable & Wireless Worldwide assets but didn’t plan to make a bid.

To contact the reporter on this story: Jonathan Browning in London at jbrowning9@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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