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More C&W/Energis Merger Speculation
By: MarkJ - 18 July, 2005 (8:58 AM)

The Guardian newspaper has posted further speculation on the prospect of Cable & Wireless's rumoured Energis takeover. It's believed that talks have just started, with a 700m deal being placed on the table:

The combined company would generate sales of more than 2bn a year, most of it from providing services to large companies.

However, C&W's chief executive, Francesco Caio, will face a tough task selling the deal to sceptical City investors. Some institutions would prefer C&W to return a large chunk of its 1bn cash pile to shareholders rather than spend 700m on Energis.

The latest results from Energis show that its sales fell to 720m in the year to March, from 745m in the same period last year.

Energis is well known for its heavy debt pile, making takeover a risk that C&W must be sure it can win. It's unclear how the move would affect ISP's linked to Energis.

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