Orbis, which owns around a 20% Cable & Wireless Worldwide stock, said it would not try to block a takeover bid for the firm by Vodafone. In an unexpected twist ahead of today’s count, Orbis altered its position and decided to back the 38p a share arrangement, which will see Vodafone become the UK’s second biggest telecoms operator behind BT.
Despite initially saying the offer of 38p a share was too low, Orbis said it now believed the deal was inevitable Getting Orbis on side was critical for CWW as it needed 75% of shareholders to vote for the deal at a meeting on Monday for it to go through.
The merger will allow Vodafone to overtake rival mobile networks Everything Everywhere and O2 in income in the UK, and to take on BT and Virgin Media in offering telecoms and data hosting solutions to the business sector.
CWW’s fibre-optic cables, one of the largest British owned networks with 20,500km of lines, will also give Vodafone the capacity to carry more mobile internet traffic at a lower cost. It currently rents a large amount of capacity from BT.
CWW shareholders casting their votes in person meet at 11am on Monday morning and a statement is expected early afternoon.