Cable & Wireless telecoms merger promises high returns for key
KPMG is set to be one of the biggest winners from the #5bn tie-up of the UK cable and telephone interests of Cable & Wireless, Nynex and Bell Canada International, writes Guy Dresser. The firm is acting as key adviser to C&W throughout the merger talks with Bell Canada International and its subsidiary operations Nynex CableComms, Bell Cablemedia and Videotron.
The merger of the UK’s second-biggest telecoms company’s British operation with two cable operators was welcomed by analysts last week and could propel the new company, provisionally known as Cable & Wireless Communications, into a position from where it could take on BT and BSkyB. If the merger goes through, C&WC would become the UK’s largest integrated entertainment and telecoms company. A proposed tie-up between C&W and BT fell through last May.
KPMG earned #5.6m from C&W in 1995, though just #1.6m came from the statutory audit. Nynex CableComms Group’s UK auditor is Coopers & Lybrand and although neither C&W or Nynex would discuss the issue, Coopers, which also audits BT, could face the axe after the merger, but this would not be until well into 1997.
