Shares in Cable & Wireless Plc bucked the nervous trend yesterday and soared after it and British Telecommmunications Plc both confirmed a UK newspaper story that they had held unsuccessful talks about British Telecom buying Cable & Wireless. The shares jumped 30 pence to 477 after BT finally acknowledged in late morning that exploratory discussions had taken place, but the news is not of the kind British Telecom wants to be out there in the market while it is tying up international alliances. It makes the company look decidedly haphazard when it has agreed in principle on an alliance with Viag AG for Germany yet has been trying to buy the partner of Viag’s major rival Veba AG. The state of the alliance between Cable & Wireless and Veba suggest that if a bid were to succeed, British Telecom would change German horses in midstream; British Telecom would almost certainly have to shed Mercury Communications Ltd in any takeover. The admission puts to rest months of renewed rumors and speculation, but represents a crushing blow to BT’s aspirations in the Far East, as a deal would have given BT access to the franchises controlled by Hongkong Telecom, which is 57.5%-owned by C&W. In a statement, acting C&W chief executive Rod Olsen, said: There was an approach to us late last year, but after carefully evaluating the proposal, the board rejected it as not being in the best interests of our customers, shareholders and partners. There are no on-going discussions. Cable & Wireless’ main markets are Asia, the Caribbean and Europe, and would have complemented BT’s growing efforts to expand its international operations and reduce its dependence on the UK market.
