By Kate Hanaghan, 3 December 2001 12:00
NEWS C&W's decision to buy the assets of struggling web-hosting giant Exodus Communication has pushed the company's share price further into the red. The $850m cash deal was not met too kindly by the markets and by close on Friday its price had been pushed down 3.7 per cent to £3.32. On top of this, Cable & Wireless will have to make a further investment of $250m to bring Exodus into a cash positive state. Upon opening this morning, the downward trend into the red continued. As of 10.30 (GMT) it had lost another 0.6 per cent and was sitting at £3.28. The deflated price does, however beat the company's year low of £2.42, which it hit back in late September. The concern for investors is that C&W is taking on a company that between Q1 and Q3 this year lost 30 per cent of its revenues. On the plus side, the deal will bring Cable and Wireless more customers and much needed traffic to internet backbone.
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