Following last week's acknowledgement that it is considering a bid for Cable & Wireless Worldwide, a Reuters report this morning says that Tata Communications (news, filings) is looking to access the debt markets raise as much as $2B in cash. Some of that is likely earmarked for refinancing activity, but it does seem likely that we're looking at an M&A war chest being assembled.
In fact the more you look at a possible Tata/C&W combination, the more it makes sense. While one can make the case for other buyers, none fit quite so well together. Vodafone is also looking at a bid, but I'm not convinced they will make a big one at this time. Others that I have suggested, e.g. Teliasonera, Level 3, and Pacnet have either less motivation or fewer available resources at this time (or both). Perhaps one that would share a similar fit with C&W Worldwide for the global assets would be NTT. But I don't see them buying substantial fiber in the UK right now, whereas Tata has fiber on that side of the globe, though principally undersea.
Additionally, the timing is right for Tata to return to an aggressive footing on M&A. It has been several years since they have been interested in international network assets, after becoming a major player via the purchases of the Tyco Global Network, Teleglobe, and IXTC. But in that time they have been investing in telepresence and the multinational marketplace as well as buying BitGravity to address the content markets. C&W Worldwide would both add scale and boost the assets underlying these efforts and give them a fiber foothold in the UK.
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