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C&W fuels guessing game over CyberWorks holding

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For almost a year, it has been a hotly debated issue among telecommunications analysts on both sides of the globe - what will Cable and Wireless (C&W) do with its remaining 14.5 per cent stake in Pacific Century CyberWorks?

The answer, they hope, will be revealed this weekend when the lock-in period for half of C&W's remaining holding expires.

Analysts predict that a stake sale would remove a temporary overhang in CyberWorks' shares and should boost both companies' stock prices in the short term.

Richard Li Tzar-kai's Internet and telecom group has been punished by investors amid the uncertainty, with CyberWorks' share price falling almost 7 per cent since January. C&W is also trading at half what it was worth a year ago - at about 820 pence.

But at present levels, C&W may choose not to sell its CyberWorks shares immediately.

One analyst said C&W had GBP4.2 billion (about HK$47.69 billion) in reserves and did not need the cash.

But Philip Carfe, analyst at Schroders Salomon Smith Barney, said everyone knew they were inevitably a seller and that would continue to hold down CyberWorks' price.

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