Redneck, ntl, our interactive cable tv partner in England is mentioned in this Cable & Wireless news article today. C&W sold some of its holdings in ntl, presumably to raise cash to fund internet purchases in the U.S., according to some sources.
biz.yahoo.com
LONDON, April 23 (Reuters) - Exodus Communications Inc (NasdaqNM:EXDS - news), Genuity Inc (NasdaqNM:GENU - news) Inc and PSINet Inc (NasdaqNM:PSIX - news) are among U.S. Internet companies that could become takeover targets for Britain's Cable & Wireless Plc, analysts said on Monday.
C&W will have around six billion pounds ($8.65 billion) of cash by the autumn after the sale of its Australian business.
A further reduction on Monday in its stake in cable TV company NTL (NYSE:NLI - news) added a further 100 million pounds to the bulging coffers of the global data telecoms specialist, which has said it is in the market for acquisitions in the United States and Japan to reshape itself into a leading provider of Internet services.
C&W said it had sold 5.3 million NTL shares, a 1.9 percent stake, leaving it with 31.1 million shares.
Exodus, the world's largest manager of company websites, jumped to the top of the list of possible targets after a Sunday newspaper said C&W was casting its eyes over the business. C&W refused to comment.
Analysts said Exodus would be a logical target for C&W as its shares are about 90 percent off their highs, giving the company a market capitalisation of $5.5 billion.
But according to a report on the Financial Times' news website FT.com late on Monday, Exodus has already rebuffed an approach from the British group, on the basis that its current market value is too low.
Internet accesss provider PSINet, which has warned it may go out of business or reorganize under bankruptcy protection laws, is another possible target, said Marco Fasoli, a managing director at takeovers adviser Broadview. He said C&W is one of of the few companies currently able to snap up such ``distressed assets''.
``There are very few companies in the world that have that combination of strategic capability and cash on the balance sheet,'' he said, mentioning Worldcom (NasdaqNM:WCOM - news) and Nippon Telegraph and Telephone Corp as possible rival bidders.
ABN Amro said C&W has made clear it is interested mainly in buying distressed assets at fire-sale prices.
``Although the Exodus share price has come under considerable pressure over the past year, the company is less financially stretched than several of its U.S. peers,'' it said in a note.
As well as PSINet, ABN named Internet access and hosting firm Genuity as a possible C&W target. Other targets named by analysts include Infonet Services Corp (NYSE:IN - news).
C&W is under pressure from investors after a profits warning last month to make acquisitions or return cash to shareholders.
But Fraser McLeish, an analyst at Investec Henderson Crosthwaite Securities, said some investors may not take kindly to the company's stepping up its presence in the United States, where falling prices helped trigger its profit warning.
``Any major acquisition in the U.S. will increase exposure to a clearly difficult market and reduce the defensive qualities of the stock,'' he said. |
