Cable and Wireless has bought eight internet service providers in Europe in a plan to expand its business-to business internet service.

The company is paying £300m ($500m) to acquire eight ISPs in Italy, France, Belgium, Spain and Switzerland.

It is also planning to spend £300m to upgrade its European telecoms network to improve the delivery of internet services.

Th eight ISPs, which provide services for European firms who want to sell to each other, have combined revenue of £80m ($130m).

It is part of the telecoms group strategy to focus on the internet and business-to-business sales which it believes have the most dynamic future.

It says that European business-to-business internet sales are likely to reach $30bn by 2002.

"The European business internet market is growing rapidly as e-commerce takes off in Europe," said C&W chief executive Graham Wallace.

"This is just the next step in implementation of our strategy in focusing Cable and Wireless on businsss customers."

Shrewd move

Analysts said that it was a shrewd move that could put C&W in a pole position in the European internet race.

"The market likes the fact that this gives them a focus in the group and they are not trying to be everything to everybody everywhere. The price paid is not extremely high or extremely low and at four times revenues looks quite good for this industry," said Credit Lyonnais analyst Tressan MacCarthy.

Last year C&W bought three other internet service providers.

Business focus

Cable and Wireless, which began as a UK telecoms provider of overseas cable, has had an aggressive programme of disposals to fund its new strategy.

It sold its undersea cables to Global Crossing, while it is seeking to dispose its UK consumer telephone business Mercury and its cable television company - although that is being delayed by a competition enquiry.

The eight companies being acquired are Austria's Xpoint, Belgium's online internet, France's ISDnet, UNIDATA and DSLogic-DSNet in Italy, agri.ch and Petrel Communications in Switzerland, and Spain's grupo INTERCOM.