Cable and Wireless Worldwide in SingTel's sights

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The Independent Online

Singapore Telecoms, the sovereign wealth-backed mobile phone-to-pay TV giant, is considering a bid for FTSE 100 group Cable & Wireless Worldwide.

Cable & Wireless shares spiked last week following rumours that US rival AT&T was putting together a takeover plan. Some analysts have dismissed the speculation surrounding AT&T's interest, but SingTel has contacted bankers in Asia and Europe to discuss its own ideas for the Bracknell-based company.

A leading corporate adviser said that SingTel was in the early stages of its plans, but that a takeover attempt was a possibility. "SingTel is running the slide rule over Cable & Wireless," said the source. "It's less than 10 per cent of the way through the process but has contacted investment banks in Hong Kong, Singapore, and London."

A deal would represent a significant coup for SingTel's chief executive, Chua Sock Koong, one of Asia's most prominent business women. Although Cable & Wireless is worth more than £1.8bn and would cost a premium on top of that. SingTel has the necessary firepower to complete a deal. It is the most valuable firm on the Singapore stock exchange and is majority owned by Temasek Holdings, which has $186bn of assets. The company has had previous dealings with Cable & Wireless, having bought Australia's Optus from the British group in 2001.

The business-orientated Cable & Wireless Worldwide is not to be confused with the more consumer-focused Cable & Wireless Communications. The groups demerged in March.

Worldwide shares closed at 72.95p on Friday, up 4.51 per cent on the start of the day's trading. The share increase is a boon to the group amid fears that it might fall out of the FTSE 100 index.

SingTel declined to comment.