ARCHIE NORMAN, chairman of Energis, the telecoms group, is understood to be pushing to secure the sale of his company to Cable & Wireless by the autumn in a move that could value Energis at about £700 million.

Cable & Wireless admitted yesterday that it is set to approach Energis’s backers.

C&W executives are said to be in the advanced stages of preparing a detailed offer to put before the banks that control Energis.

The two groups are thought to have built up a dialogue over the past year, but only recently began serious talks over the possibility of a merger.

Richard Lapthorne, chairman of C&W, confirmed at the group’s annual meeting yesterday that he saw scope for consolidation in Britain. He told shareholders: “We are approaching the stakeholders of Energis concerning a possible acquisition.” However, he urged caution: “We cannot be sure of the result . . . There is due process which will not be complete until around mid-August.”

Mr Lapthorne is expected to take his offer in the next couple of months to Energis’s board, which then could recommend the approach to its stakeholders, who are dominated by a consortium of banks.

The group’s bankers took a controlling stake in the telecoms group’s new holding company three years ago, after its predecessor, Energis plc, was put into administration.

The company was rescued by a team led by Mr Norman and John Pluthero, who was brought in as chief executive. It is thought that Mr Pluthero would stay on in the event of a takeover, although it remains unclear whether Mr Norman would remain with the larger group.

It is thought that the banks will go with the board’s recommendation. City sources last night said the deal would probably be an all-cash offer, given the strong interest of the banks.

A merger of the two groups has long been mooted. Energis’s British business, which serves clients such as the BBC and Tesco, is seen as complementary to C&W’s UK operation, which makes much of its revenue from providing relatively low-margin services to other telecoms carriers.

If the deal does go ahead, the enlarged C&W would have British revenues of some £2.3 billion. C&W’s approach for Energis comes as the group looks to drive growth in its British business. NM Rothschild is advising Energis, while JP Morgan is advising C&W.

Energis refused last night to comment on the approach. C&W declined to give further comment.

C&W has been the subject of takeover speculation itself, with France Télécom cited as a possible suitor for the group. Mr Lapthorne said yesterday that the group had no interest in being taken over.

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