C&W USA asset bid goes to court

Cable & Wireless USA (a subsidiary of London-based Cable & Wireless) will attend a bankruptcy court hearing this afternoon to begin the formal auction process for its corporate assets. C&W USA accepted a proposal this week from an affiliate of investment firm Gores Technology Group to purchase its assets for $125 million (an amount subject to adjustment based on C&W USA’s corporate performance). According to C&W USA, a bankruptcy judge will next establish an auction whereby other would-be buyers may submit better offers. Last week Telephony reported that a source close to the negotiations viewed Level 3 as the most likely buyer of C&W’s U.S. assets, but that source believes Level 3 may have been solely interested in the wholesale business through which C&W terminates international traffic into the U.S. However, a C&W USA spokesman said the international wholesale part of the business was not part of the proposed asset sale to the Gores Technology affiliate. Level 3 declined to comment.