Vodafone, the global mobile-phone giant, on Monday revealed plans to purchase Cable & Wireless Worldwide Plc (CWW) for 1.04 billion pounds, or $1.7 billion in cash.
Vodafone CEO Vittorio Colao told analysts that the deal would make Vodafone the second-largest telecommunications supplier in the United Kingdom after BT, doubling the size of its enterprise business in Britain, Reuters reported.
"The acquisition of CWW will strengthen the enterprise business of Vodafone Group in the U.K. and internationally and presents attractive network and other cost savings opportunities for Vodafone Group," Vodafone declared in a press release.
CWW's directors consider the terms of Vodafone's offer "to be fair and reasonable," Vodafone said, and they have agreed to recommend unanimously that CWW shareholders approve the agreement. However, CWW's largest shareholder, has told Bloomberg News it doesn't support the deal.
"The proposed deal is clearly attractive for Vodafone shareholders. However, we are concerned that the offer price does not appear to reflect the value inherent in CWW," said Orbis Holdings Ltd., which owns a 19 percent stake, in a statement sent to the news agency.
Vodafone anticipates that the acquisition will be completed in the third quarter, Bloomberg reported.
The terms of the offer call for Vodafone Europe B.V, an indirect wholly-owned subsidiary of Vodafone Group Plc, to acquire CWW.