UK mobile operator Vodafone could decide not to bid for local fibre operator Cable & Wireless Worldwide (CWW) because of concerns over the quality of its assets, according to banking rumours.
“Vodafone is said to believe that CWW’s network has…
UK mobile operator Vodafone could decide not to bid for local fibre operator Cable & Wireless Worldwide (CWW) because of concerns over the quality of its assets, according to banking rumours.
“Vodafone is said to believe that CWW’s network has been underinvested for a long time and that this has affected the quality of the assets,” explained one banker.
Vodafone, which declined to comment, announced on 13 February that it was in the early stages of considering whether to make a cash offer for the enterprise-facing telco. It is being advised by UBS and, under takeover regulations, must declare whether it will submit a bid by 12 March.
In contrast to the rumours that Vodafone is set to walk away from its potential bid, reports suggest rival suitor Tata Communications, the Indian telco, is already seeking loans to fund its CWW offer.
Tata, which is advised by Standard Chartered and must declare whether it will submit a bid by 29 March, is reportedly seeking US$2bn in term loans to partly finance a CWW offer and to refinance existing debt. Reports have cited CWW shareholders calling for at least £1bn (US$1.59bn) from any potential buyer.
CWW, which is being advised by Barclays Capital and Rothschild, currently has a market cap of around £900m (US$1.43bn).
