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C&W to withdraw from US
From: Steve Bellovin <smb () research att com>
Date: Thu, 05 Jun 2003 11:32:56 -0400
According to media reports, C&W is going to withdraw from U.S. markets.
No word on the of its Internet operations; the Wall Street Journal says
C&W declined to say how much the new restructuring plan
will cost or explain how it plans to withdraw from the U.S.
because it doesn't want to weaken its negotiating position
with potential buyers of assets. Although the company has
£850 million in outstanding property leases in the U.S.,
Richard Lapthorne, the company's new chairman, said the
company's net cash of 1£.62 billion means "we know we can
afford the worst case." Most of C&W's U.S. revenue is
derived from hosting Web sites for large companies, such
as Microsoft Corp.
C&W pushed into the U.S. Web-site hosting market by buying
Digital Island Inc. of San Francisco and most of the assets
of Exodus Communications Inc. of Santa Clara, Calif., for
about $1 billion in 2001. But Mr. Caio says C&W's competitors
have lower costs, and its U.S. operations had an operating
loss of £255 million on revenue of £512 million in the year
ended March 31.
--Steve Bellovin, http://www.research.att.com/~smb (me)
http://www.wilyhacker.com (2nd edition of "Firewalls" book)
- C&W to withdraw from US Steve Bellovin (Jun 05)