Vodafone speeds up CWW integration

UK-based Vodafone is to create a new Group Enterprise unit aimed at speeding up the integration of Cable & Wireless Worldwide, the fixed-line communications business it bought for about £1 billion ($622 million) in July.

Vodafone (Newbury, UK) says it needs to integrate the business faster than it originally planned because of customer demand for combined products and services.

UK-based Vodafone is to create a new Group Enterprise unit aimed at speeding up the integration of Cable & Wireless Worldwide, the fixed-line communications business it bought for about £1 billion ($622 million) in July.

Vodafone (Newbury, UK) says it needs to integrate the business faster than it originally planned because of customer demand for combined products and services.

The new unit will start operating on January 1 2013 and be led by Nick Jeffrey, the current chief executive of CWW (London, UK), who will report directly to Vodafone chief executive Vittorio Colao.

It will include four divisions – Vodafone Global Enterprise; Vodafone Carrier Services; Machine-to-Machine solutions; and Hosting and Cloud Services – each operating across 50 countries and supported by dedicated products, sales and marketing teams.

As a result of the unit’s creation, a number of CWW’s enterprise activities will be fully integrated with those of Vodafone, including support functions like finance and human resources.

Vodafone has previously announced that it expects to incur cumulative integration costs of about £500 million by March 2016, with cash-flow synergies of between £150 million and £200 million a year by the same date.

By then, operating free cash flow resulting from the acquisition is expected to amount to between £250 million and £300 million.

Vodafone’s July takeover of CWW was designed to bolster its enterprise business and make it a stronger rival to BT, the UK’s former state-owned fixed-line monopoly.