LONDON (AFX) - Colt Telecom Group PLC said it will undertake the early redemption of its outstanding US dollar 12 pct Senior Discount Notes due 2006 for 122 mln stg.

The redemption will funded from COLT's cash and liquid resources. The redemption will take place on Dec 22.

In a statement, chief financial officer, Marina Wyatt said: 'COLT is financially strong with 934 mln stg mln of cash and liquid resources as at 30 September 2003 and we expect to be free cash flow positive on a sustainable basis during 2005.'

Wyatt said the company will save about 30 mln stg in net interest over the next three years following the early redemption.

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