Healthy business and a cash mountain at C&W

Cable & Wireless (C&W) is sitting on a cash mountain of £4.2bn and should raise another £2bn from its sale of parts of Optus, its Australian mobile phone operation.

This makes it one of a small clutch of telcos that are not mired in debt. The company has revived itself by concentrating on sales of business IP services. The company will be investing £3bn this year in its international internet network, but finance director Robert Lerwill said that after this spend, the company would only need another £1.5bn. These spends will leave the cash hoard intact. Chief executive Graham Wallace said the company is not looking for any major acquisitions, but a series of small ones in the 'hundreds of millions' level. C&W owns stakes worth about £2.65bn in cable TV group NTL and Pacific Century Fibreworks in Hong Kong and will be able to sell these early next year. At C&W Optus, the parent company aims to concentrate on the business and data segment of the operations and hive off its share of the consumer and mobile services. Company sources say that it is also contemplating a return of cash to shareholders.