Cable & Wireless shareholders approve $1.67bn Vodafone buyout

Cable & Wireless Worldwide can now be bought by mobile phone giant Vodafone following a major shareholder's approval of the deal. But it wasn't smooth sailing until close to the vote itself.

Cable & Wireless Worldwide shareholders have overwhelmingly agreed to a takeover worth £1.04 billion ($1.67bn) in cash by mobile phone giant Vodafone.

The cable behemoth operates a series of high-speed networks to police and governments, along with owning a vast array of more than 400,000 kilometers of undersea cables connecting around 150 countries.

The mobile phone giant is now the second-largest telecoms company in the U.K. after British Telecom.

It also operates the largest fibre network in the U.K.; one of the reasons Vodafone wanted to buy the company in the first place.

The move allows Vodafone to break away from BT's infrastructure, which it had heavily relied on before the deal.

But the deal was close to being vetoed by a major shareholder that believed the company could be worth more.

Bermuda-based Orbis, which owns 19 percent of Cable & Wireless Worldwide, caved into the bid at the eleventh-hour after admitting the deal would likely go ahead sooner or later.

The major shareholder had threatened not to pass the deal claiming 38p ($0.62) a share undervalued the company. But Orbis wanted something in the region of 40--45p ($0.62--$0.70) per share.

Vodafone actually bumped the figure from its 32p ($0.51) a share at market close on April 23 to sweeten the deal. Having said that, Vodafone is paying around 2 percent less than what Cable & Wireless Worldwide was worth on average during the past 12-months.

Vodafone needed 75 percent of the shareholder vote, but only managed 58.8 percent before the vote. But only 60 percent of shareholders were able to vote in the emergency meeting.

Orbis would have knocked the total over the magic mark. In the end, the tally reached a majority of 78.7 percent share --- but Orbis threw its weight behind the bid to round up to a firm 99.1 percent.

Both Cable & Wireless Worldwide and Vodafone were up at market close.

Image credit: Jessica Dolcourt/CNET.