C&W shareholders lobby for chief's removal

Shareholders in Cable & Wireless were yesterday considering ways of ousting the company's chief executive, Graham Wallace, including lobbying non-executive directors for his departure.

Shares in Cable & Wireless, which started the week at 132.5p, collapsed after it revealed its strategic review on Wednesday. They closed up 1.25p yesterday at 75.75p.

"When there's a complete breakdown of trust, like there is here, where do shareholders go? They pretty well have to resort to the non-executives," one investor said. "And if enough people [shareholders] feel sufficiently strongly, which they do, and make their position known to the non-execs, then the only option those non-execs will have is to follow their [shareholders'] wishes."

Calls for Mr Wallace, who has presided over four profit warnings, to leave, increased this week after Cable & Wireless announced it was pulling out of much of its US and continental European operations at a cost of £800m.

One City source said: "Management, under Graham Wallace, has been responsible for a huge destruction of shareholder value and it would seem very unlikely that shareholders would want him to carry on."

Separately, the credit ratings agency Moody's Investors Service yesterday downgraded Cable & Wireless' long-term debt ratings to Baa2 from A3 and put both its long and short-term ratings on review for a possible downgrade.