Reinforcing position in internet services in Japan
Cable and Wireless plc (Cable & Wireless), the global telecommunications group, announced today (10 December 2001) that it has agreed, through its subsidiary, Cable & Wireless IDC, to acquire PSINet Japan, Inc. (PSINet Japan) from PSINet Inc.
Cable & Wireless and PSINet have signed a Share Purchase Agreement to acquire the entire issued share capital of PSINet Japan for approximately #7.2 million.
PSINet Japan provides IP (internet protocol) connectivity and web hosting services for enterprise customers in Japan. The company has points of presence within key Japanese cities, a data centre in Tokyo and provides services to several thousands of business customers.
The acquisition is intended to reinforce Cable & Wireless position in Japans growing internet market and accelerate the delivery of Cable & Wireless strategy to provide IP and data services to business customers in Japan. PSINet Japans revenue in the first half year 2001 was #28 million and the acquisition is expected to more than double Cable & Wirelesss IP revenue within Japan.
Commenting on the announcement, Simon Cunningham, President and CEO Cable & Wireless IDC, said:
This acquisition highlights our commitment to the Japanese market and clearly fits our strategy to grow our IP business within Japan. We will realise cost synergies upon the acquisition through the sharing of a much larger infrastructure whilst our continued commitment to quality will bring benefit to a much broader customer base.
PSINet Inc (PSINet Japans US parent) is currently subject to US Chapter 11 bankruptcy proceedings and, as is customary in these situations, the Share Purchase Agreement provides for a court supervised auction process at which other qualified bidders will be entitled to bid for PSINet Japan . The Share Purchase Agreement also provides that, subject to court approval, Cable & Wireless will be entitled to a break-up fee and certain expenses if another party outbids Cable & Wireless in the auction and that party proceeds to completion.
Completion of the transaction is subject to customary closing conditions. At completion the shares in PSINet Japan will be registered in the name of Cable & Wireless IDC.
Under the terms of the Share Purchase Agreement, Cable & Wireless may terminate the Agreement if the transaction is not completed by 28 February 2002.
About Cable & Wireless
Cable & Wireless is a major global telecommunications business with revenue of over £8 billion (US$11 billion) in the year to 31 March 2001 and customers in 70 countries. Cable & Wireless focus for future growth is on IP (Internet protocol) and data services and solutions for business customers. It is developing advanced IP networks and value-added services in the US, Europe and the Asia-Pacific region in support of this strategy. With the capability of its global IP infrastructure and its strength in key markets, Cable & Wireless holds a unique position in terms of global coverage and services to business customers.
For more information about Cable & Wireless, go to http://www.cw.com
Contacts for Cable & Wireless:
Chris Tyler, Investor Relations, +44 (0) 20 7315 4460
Valerie Gerard, Investor Relations, +1 646 735 4211
Susan Cottam, Media, +44 (0) 20 7315 4410
Peter Eustace, Media, +44 (0) 20 7315 4495
Cable and Wireless plc
124 Theobalds Road
London WC1X 8RX
10 December 2001
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