C&W 'to revive demerger plans'

Cable and Wireless is planning to dust off demerger proposals

Telecommunications giant Cable & Wireless is planning to dust off demerger proposals that will see the group split its UK and international businesses, it has been reported.

The firm is understood to be preparing to announce the move alongside half-year results on Thursday.

Cable put the break-up plans on ice last November at the height of the financial crisis due to the stock market turmoil and credit squeeze.

But it is believed the group will tell the market it is reviving proposals for separate stock market listings of its UK and international divisions amid calmer equity market conditions.

Cable may look to complete the demerger in the first half of next year, although it is unlikely to commit to a set timetable, according to the Financial Times report.

A spokesman for Cable said the decision to postpone its "value realisation" plan was being kept under constant review, but declined to comment further on Monday's report.

Cable is thought to be keen to resurrect the plans to give shares a boost, with its stock lagging behind growth in the wider FTSE 100 Index.

Major investors are also reportedly pushing to see the break-up back on the agenda.

A demerger could trigger payouts to senior executives at Cable under the group's long term incentive plan.

The bonus programme is already paying out £32 million to managers this year, with an £8.3 million windfall for John Pluthero, the boss of Cable's Europe, Asia and US division, since rebranded Worldwide.