C&W reshuffles senior management
Cable and Wireless has reshuffled the senior management team of its cash-strapped global data services division, C&W Global, in...
As part of the reshuffle, Don Reed, formerly chief executive officer of C&W Global, will be based full-time in the US, charged with concentrating on regulatory, government and other corporate matters. C&W Global provides Web site hosting and telecommunications services for corporations.
Reed's operational responsibilities for C&W Global are being reassigned to Adrian Chamberlain, formerly the director of group strategy and now CEO of Global Services and Europe/Asia, and Simon Cunningham, CEO of C&W America.
Cunningham is to report directly to C&W CEO Graham Wallace who will become more directly involved in the restructuring of the business in the US.
Additionally, Global chief financial officer Donald Muir will now report directly to C&W finance director David Prince, who will take on more responsibility for Global's finances.
The move comes four days after Moody's Investors Service announced it was downgrading C&W's credit rating to junk bond status, forcing the company into a scramble to find £1.5bn in reserve cash to cover an agreement made three years ago with Deutsche Telekom.
As part of Deutsche Telekom's deal to buy C&W's half share in mobile phone operator One2One in 1999, C&W is responsible under a "ratings trigger" clause to cover any potential tax liabilities that may result from changes in the credit rating of C&W's debt load.
Last month, C&W announced its 12-month restructuring plan for C&W Global, which is designed to save around £400m a year in operating costs, and will reduce the division's headcount from 12,500 to 9,000 employees. Most of those job cuts will come in the US.
C&W opted for a total exit from the US and continental Europe except for multinational enterprise and service provider customers, after reporting that, in the six months ending 30 September, operating costs for C&W Global, before exceptional items, were £813m, with a decline in revenue of 5%.
Fixed assets in the division were written down in the period by £787m and the remainder of the division's goodwill of £2.7bn has also been written off.
David Nash, who was set to take up the chairman's position next month, resigned in November and C&W is conducting a search for a new chairman.
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