Network operator Cable and Wireless PLC (C&W) has agreed to sell its Japanese business, Cable & Wireless IDC Inc., to Softbank Corp. for £72.4 million (US$133.3 million), the London-based company announced Tuesday.
The deal, which will include the assumption by Softbank of C&W IDC debt worth £9.5 million, is expected to be completed in the C&W's fiscal fourth quarter ending March 31, the company said.
C&W will retain two international data nodes, allowing it to continue to provide customers with network service to and from Japan. C&W operations in other parts of Asia, including Hong Kong, China, Singapore, Macau and India, will be unaffected by the sale, the company said.
The sale of C&W IDC is part of C&W's continued retreat from its once-planned $3.5 billion global IP (Internet Protocol) network.
The company said in 2000, that in Japan alone, it would invest £960 million over five years to build an optical fiber network. However, the company's fortunes turned in 2001, which C&W blamed in part to decreased demand for its fiber optic networks. C&W cut thousands of jobs and began selling some of its assets, including its stake in Hong Kong telecommunication operator Pacific Century CyberWorks Ltd. (PCCW). It also launched a company restructuring plan which included dismantling its global data services division, C&W Global, and exiting from the U.S. and continental Europe, except for multinational enterprise and service provider customers.
In January, as part of a court-supervised bankruptcy sale, C&W sold its U.S. Web hosting and IP services businesses, Cable and Wireless America Inc. (CWA), to Savvis Communications Corp. The deal was for $155 million in cash and the assumption by Savvis of liabilities of approximately $12.4 million. C&W began its retreat from the U.S. market in September 2002 when it sold its U.S. retail voice and data business to Primus Telecommunications Group Inc.
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