John Pluthero quits Cable & Wireless Worldwide after less than six months

Cable & Wireless Worldwide (C&WW) has replaced John Pluthero as chief executive less than six months after he took the job, after the beleagured telecoms giant swung to a £433m half-year loss.

Shares in the company plummeted more than 10pc to 27pc in early morning trading, as the company named Vodafone’s Gavin Darby as its new chief executive, on a pay package worth up to £3.3m.

Mr Darby was chief operating officer and then chief executive of the UK business before becoming chief executive of Vodafone’s join ventures and investments outside Europe.

The appointment marks C&WW’s latest attempt to reassure investors it will return to an even keel following its split from Cable & Wireless Communications in March 2010, and to draw a line under a saga that has wiped more than two-thirds off its value in the past year.

Mr Pluthero seized control of the company at the end of June after then chief executive Jim Marsh presided over his third profits warning in just over a year and left with a £650,000 pay off.

Shareholders vented their fury at the hasty management restructure, saying C&WW has become a “walking disaster compounded by arrogance”.

However, Mr Pluthero, previously chairman of the telecoms company, reassured them that he saw its “redevelopment” as “unfinished business”. “I have both personal and financial equity invested in seeing it through,” he said at the time.

However, he said on Tuesday that C&WW needed a leader who could stay for longer than he was prepared to.

“We identified various elements of what we thought needed to be done and we all agreed that, given some of the elements play out over three to five years, the business needed a chief executive who would stay for three to five years,” he said.

The board asked Mr Pluthero to stay the course but he found the prospect “quite difficult” because he “had been moving in the other direction” by becoming chairman, he added.

However, he said the company had already made good progress on its turnaround plan and that it was “not far off firing on all cylinders”.

Revenues at Cable & Wireless Worldwide slipped slightly to £1.07bn in the six months to September 30, 2011, from £1.12bn last year.

The company moved from a £53m pre-tax profit in the first half of 2010 to a pre-tax loss of £433m after £624m of writedowns, largely relating to a deferred tax asset and impairment of goodwill. However, margins widened slightly from 46pc to 48pc.

Mr Darby will join C&WW on November 28 on a salary of around £600,000, a discretionary annual bonus of the same figure, and £1.2m worth of shares depending on performance. He will also be awarded a golden hello of £600,000 worth of shares, and the company will match any share purchases he makes after that up to the value of £300,000.

Mr Pluthero will remain on the board until the end of the year and with the business until March. He has elected to forfeit any share incentive awards.

Source: The Telegraph, 15th November 2011

Back to News »