Vodafone on brink of closing £1bn CWW buyout

Mobile outfit set to massively expand enterprise footprint as telecoms firm's largest shareholder drops opposition

Vodafone is closing in on a £1bn deal to buy Cable & Wireless Worldwide (CWW) as the carrier's major shareholder Orbis Investment Management has bestowed its acquiescence on the deal.

The boards of the two telecoms players agreed the deal in April, but Orbis was quick to voice its concerns. The possibility of Vodafone changing the structure of the deal from a scheme of arrangement shareholder vote to a contractual takeover - wherein individual shareholders could negotiate their sales price - was mooted. But Vodafone has indicated it will not switch its bid to a contractual takeover offer.

Orbis today issued the markets with a statement claiming "we now believe that the CWW scheme of arrangement will eventually succeed, even if Orbis were to vote against it today". Consequently, the investment firm has decided to back the offer.

"In these circumstances, our opposition would only serve to prolong the process because the company would likely adjourn today's meetings to secure the necessary votes," adds the statement. "This is not in the interests of any CWW stakeholder. Accordingly, Orbis intends to vote in favour of the scheme at the meetings today."

If and when it acquires CWW, Vodafone will be given a much larger footprint in the UK enterprise space. It will also provide the mobile network operator with a sizeable fixed-line network and a much bulkier data proposition.