Sharewatch: C&W Rises On Takeover Speculation

Cable & Wireless was the markets big story on Thursday as news of a take-over bid from Hong-Kong based telecoms group, Pacific Century Cyberworks (PCCW), had traders on the run (see Cable & Wireless Subject Of Takeover Speculation). However, some have already dismissed the offer as hot air, claiming PCCW has no intention of making an offer and is simply trying to flush out another bidder.

PCCW is heavily debt burdened and it is understood that there has been no formal proposal of a buy-out from the group. However, shareholders who have watched the value of Cable & Wireless shares fall over the past year are anxious to re-coup some of their losses and are reportedly calling on the company to explain why it had already rebuffed an approach from PCCW earlier in the year. Shares in the cable company rose 9.96% yesterday.

Elsewhere, the City was seen stunned by news from the Bank Of England, which cut interest rates to their lowest level since 1955, in an attempt to prevent the economy sliding into recession. The BoE sliced 0.25 points of borrowing costs to 3.75%.

The closing prices of media company shares on Thursday were: