C&W settles £1.5bn tax dispute
C&W yesterday reached an agreement with the Inland Revenue to pay £380m to settle tax liabilities in relation to a decade of acquiring and selling companies.
The settlement includes the disputed tax liability of One2One to Deutche Telecom in 1999. Under the terms of the deal, C&W was forced to pick up the bill for future tax liabilities and outraged the City last December by accruing £1.5bn to this extend.
The bargain settlement revived C&W’s dire liquidity situation, settling most of analysts’ concerns. Following the news, C&W shares instantly surged from 13.25p to 73.25p.