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Warning Angers Investors

March 14, 2001|Reuters

Cable & Wireless, which operates the third-largest global network for Internet services, issued a profit warning and said it would cut 4,000 jobs, citing tumbling prices in the U.S. and Japan. The news angered investors and drew the attention of financial regulators. Only minutes after assuring investors it did not have any bad news to report, the London-based company said its profit would fall short of forecasts this year and said it would cut 4,000 jobs over the next 12 months. C&W blamed falling prices for companies that carry telecom traffic for other operators. The Financial Services Authority routinely declines to comment on specific cases, but, when pressed on the C&W announcement, an FSA official said: "We do take any potential breaching of the rules seriously, and we do look into it." C&W's shares fell 20% in London.

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