CHARLES HERLINGER the ousted finance director of Cable & Wireless (C&W), will leave the telecoms group with a £400,000 payoff.

Mr Herlinger’s departure is part of a wider board shake-up announced yesterday by C&W as the group splits in two and seeks to revive its troubled British business.

Graham Howe, the senior independent director, and Rob Rowley, the deputy chairman, are also leaving C&W while Tony Rice, a non-executive director, has taken over the role of finance director from Mr Herlinger. The departures follow the overthrow last month, of Francesco Caio, the Italian chief executive who will leave in April.

C&W, which last month issued its second profits warning in four months, has shed 2,000 workers since the end of 2004. Up to 3, 000 more redundancies are planned for Britain. The company declined to say how much the redundancies would cost.

The group’s announcement last month, that it is to split into two - the British division and its more successful overseas business - was interpreted by analysts as the hoisting of the for-sale sign.

However, industry sources say that, while many potential buyers have cast an eye over C&W, none is keen to pounce on it.

The telecoms company said that the changes, in which the board will be slimmed down, were aimed at “maximising shareholder value over the next three years”.

Richard Lapthorne, the chairman, who has previously declared that private equity bidders were bound to be eyeing up the company, said: “The changes are designed to focus the organisation on the creation of shareholder value through delivering improved performance.”

Analysts are still speculating about the future of Bulldog, the consumer broadband division, upon which C&W has spent more than £250 million.

Some believe that the group would be better placed to run the business as a wholesale business - selling products to its rivals - rather than seeking to compete in the fiercely competitive home broadband market.

The group has denied rumours that it will sell Bulldog, instead insisting that it is sticking with the division because it is an important strategic asset.

Shares in the group closed up 2p at 109.75p.

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