C&W 'is close to sell-off in Japan'

CABLE & Wireless is reported to be close to a deal to sell its Japanese operations to that country's largest internet provider, Softbank.

The Japanese unit could fetch up to 10bn yen (£50.7m). The deal appears to be part of Softbank's strategy to expand its business into telecommunications services.

The company is already buying JapanTelecom, the nation's third-largest fixed-line company, from US buyout firm Ripplewood for $3bn (£1.6bn).

The acquisition of Cable & Wireless IDC could help Softbank erode the dominance of the giant Nippon Telegraph & Telephone of the sector. Softbank denies the report-while C&W would not comment.

C&W won the then International Digital Communications in a bidding war with NTT in 1999. The company's focus is on providing internet, data and voice services to its 40,000 business customers, a sector that has become a major battleground since April when the government fully liberalised the market.

C&W has seen business decline, with revenues in Japan dropping from £158m in the first half of the year to £128m in the second.

It has been labelled 'disastrous' by some analysts, who have called for its disposal.