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Tuesday, 01 July 2008 |
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Long-term pursuit by an old lame duck of a newer, lamer duck fails to set feathers flying. But stuffing may follow. At least there are no Koreans and dogs in the same sentence of this oddly British story!
Pith helmet set jauntily to one side, Cable & Wireless has a century-long history of seeking out ICT ‘tiffin’ in obscure imperial ‘pink bits’ even as the sun has set darkly and resolutely on the British Empire which gave birth to the company. Since 1980, it has been raging against the dying of the light into which it was born and by whose warmth it was incubated.
C&W has outlived the Empire which first fostered it but for three decades it’s been not much more than a joke. Handed the chance of a ‘primus inter pares’ competitor to the UK’s BT, as the British market was controversially deregulated ten years ahead of most of Europe, it fluffed its lines and fluffed its chance.
Since then, it has gradually shed global network assets to placate shareholders and, it should be said, to allow those operations to be run like real businesses rather than artificial arms of some colonial bureaucracy.
Humbled in this way, C&W is now experiencing one of its occasional spasms of growth. True to form, it is trying to secure a slice of the UK business comms market that was once ring-fenced for it by pre- and post-duopoly regulation. Too late, it wakes up. Too little, too late.
A reported 185p per share bid is said to be welcomed, with C&W’s shares trading slightly up on the new today and Thus shares up, but under, the bid level. C&W’s original bid was cooler at 165p. As the saying goes, C&W knows the price of everything and the value of nothing.
Hard to spot the synergy in Thus while it must be said that many of that company’s largest shareholders stand to gain from the improved offer. For an infrastructure and services company that began life as past of Scotland’s electricity utility, it’s a further mark of decline. A Spanish company now owns that power utility. Thus could hardly wish for a worse fate; C&W can hardly hope for a better one.
Jim Chalmers
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