Shares in the telecoms company Cable & Wireless have tumbled because investors are worried that group's global business is eating up too much cash.

There is widespread speculation that C&W is about to take a charge of �1bn ($1.6bn) to pay for the cost of reviving C&W Global.

The group is due to announce its half-year financial figures on Wednesday along with the results of a major review of the business.

There are reports that C&W will announce up to 3,000 job cuts, and that the figures will show the group's losses have increased.

Chief executive Graham Wallace is under pressure to show that he can improve the group's performance and its share price.

Staff to be told first

The company's stock has already lost more than half its value this year and has fallen more than 90% since peaking at more than �15 in March 2000.

In lunchtime trade on Monday, the shares stood down 6.4% at 124 pence.

But the stock recovered to close at 127p, down 5.5p.

C&W had warned in September that it might have to cut more jobs after it reduced its revenue forecasts for its global business.

"It is likely there will be further job losses, but we will consult and communicate any developments to employees first," a company spokesman said at the time.

C&W's global division employs about 12,000 people, with a large proportion in the UK at sites in London, Birmingham, Warrington and Bracknell.

The division supplies services to large firms in the US, Europe and Japan but has struggled in the face of weak demand for telecoms services and tough price competition from rivals.