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One-2-One up for sale
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March 24, 1999: 4:29 a.m. ET
U.K. cellular operator in play as MediaOne, C&W opt to 'explore options'
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LONDON (CNNfn) -
In a development likely to set off a scramble among European telecom operators, MediaOne and Cable & Wireless are considering selling One-2-One, their U.K. cellular joint venture.
The companies Wednesday announced plans to explore "strategic alternatives" for the unit, including "an initial public offering or a potential strategic sale of all or part of the company".
MediaOne (UMG) had made it clear that its 50 percent stake in the venture was under review following the U.S. cable operator's acquisition by Comcast (CMCSA) Monday.
Comcast appointed Lehman Brothers to evaluate strategic options for its international wireless operations. C&W has appointed Merrill Lynch.
Though the owners are paving the way for the sale, analysts warned that the list of likely buyers could be diluted by the ability of the financial markets to fund another large acquisition after a slew of major bond issues and loans in the sector.
European telecom stocks have lost some of the gloss which saw them ride out the financial storms in 1999 when the sector's appeal saw it able to open up depressed IPO, corporate and high-yield markets.
One-2-One, launched in 1993, is the U.K.'s fourth-largest mobile operator with 1.9 million subscribers. Germany's Deutsche Telekom (FDTE) and Mannesmann (FMMN) as well as Bell Atlantic (BEL) and SBC Communications (SBC) of the U.S. are all viewed as possible bidders.
Cable & Wireless shares opened 1 percent higher in London Wednesday at 738.5 pence. The company's stick slipped last week after the Germany's Veba (VBA) sold its 10 percent stake in C&W in a block sale to institutional investors raising prospects of a bid for C&W itself.
The market has been flooded with telecom paper this year, with AT&T launching a record-breaking $8 billion corporate bond Tuesday. Vodafone (VOD) tapped the market for $10 billion to pay for AirTouch (ATI) and Olivetti and Telecom Italia are planning issues in their disputed takeover battle. 
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