Departures a setback for Cable & Wireless

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The Independent Online
THE tarnished image of Cable & Wireless in the City may have taken a further knock after the abrupt departure of two senior executives from the telecommunications group.

John Eyre, the director of corporate affairs at Cable & Wireless, and Steven Olivant, head of investor relations, left at the end of last month.

The departure of Mr Eyre and Mr Olivant, who had only been with the company for a year, is the latest in a series of embarrassing upheavals. In March, Peter van Cuylenburg, one of two top operational directors in the group and the former chief executive of Cable & Wireless's Mercury subsidiary, left equally suddenly to join the US-based NeXT computer company, which is headed by Apple Computer's founder Steve Jobs.

It is understood that Mr van Cuylenburg failed to see eye to eye with Lord Young of Graffham, the chairman. His departure follows the resignation last year of Gordon Owen, the group managing director, who was also understood to have been at loggerheads with Lord Young.

Cable & Wireless refused to give any reason for the latest departures. But it is believed that a bungled announcement about Mercury's Personal Communications Network, which will rival cellular radio, was the main cause for the upheaval. In March, Cable & Wireless announced that it would merge Mercury PCN with a similar PCN service planned by US West, one of the American 'Baby Bell' regional telephone companies.

Lord Young said that the merger would cut pounds 50m from the year's profits, but he annoyed the City by failing to provide enough information, especially about the breakdown of the pounds 50m provisions.

The merger also sparked rumours of a wider link between Mercury and US West. Speculation has mounted that the American company will take a major stake in Mercury.

Only a few months earlier, the City rumour machine had been busy discussing the outcome of talks between Cable & Wireless and AT&T, the US telecommunications giant. These talks were heavily leaked but ultimately failed, again causing anger among investors.

Staff at Cable & Wireless also say that there were worries about the company's relationships with the media and the City. Management has recently held one-to-one talks with institutions.

One analyst said Cable & Wireless is keen to calm investors' nerves. He said the perception of the company had begun to improve but that the situation remained 'fluid'. James Ross, the new chief executive, is likely to institute further change, it is believed.

(Photograph omitted)

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