<PAGE>

                                                                  CONFORMED COPY

                                                                    EXHIBIT 4.23

To:      JPMorgan Chase Bank (the ("LENDER")
         125 London Wall
         London EC2Y 5AJ

                                                                   6 August 2002

Dear Sirs

THE SWAP TRANSACTIONS LISTED IN SCHEDULE 1 AND ENTERED INTO BETWEEN THE COMPANY
AND THE LENDER (THE "SWAPS")

1.       INTERPRETATION

         Terms defined in the syndicated credit facility agreement dated 25
         March 1998 between Marconi Corporation plc (formerly known as The
         General Electric Company, p.l.c.), HSBC Investment Bank plc as agent
         and others (as amended from time to time, the "FACILITY AGREEMENT")
         shall, unless otherwise defined herein, have the same meaning when used
         in this letter.

2.       CLOSE OUT OF THE SWAPS

         We confirm our agreement to terminate the Swaps and any and all of the
         Lender's and the Company's payment obligations (whether absolute or
         contingent) thereunder with effect from 7 August 2002 (the "CLOSE OUT
         DATE"). As a consequence of such termination the net sum in an
         aggregate amount of $56,193,953.70 (the "SETTLEMENT AMOUNT") will
         become due from the Company to the Lender on the Close Out Date.

3.       DEEMED ADVANCE

         This Letter sets out our mutual agreement to treat the Settlement
         Amount as an advance (the "CLOSE OUT ADVANCE") deemed to have been lent
         to the Company by the Lender on the Close Out Date.

4.       INTEREST

         (a)      Interest shall accrue on the Close Out Advance from and
                  including the Close Out Date to (but excluding) the date on
                  which the Close Out Advance is repaid in full at the rate per
                  annum determined by the Lender to be the aggregate of:

                  (i)      LIBOR (which shall be the interest rate per annum
                           applicable to U.S. Dollar Advances under the Facility
                           Agreement or, if (x) no such rate is calculated under
                           the Facility Agreement, it shall be the rate offered
                           by the Lender to prime banks in the London interbank
                           market or, if (y) the interest rate applicable to
                           Advances under the Facility Agreement falls to be
                           determined pursuant to the provisions of Clause 13.3
                           (Alternative Rates) of the Facility Agreement, the
                           interest rate applicable to the Close

<PAGE>

                           Out Advance shall be the rate per annum which
                           expresses the cost to the Lender of funding the Close
                           Out Advance from whatever sources it may reasonably
                           select with a view to providing funding at the lowest
                           reasonable practicable rate);

                  (ii)     2.25 per cent. per annum; and

                  (iii)    an amount (as determined by the Lender acting
                           reasonably and calculated in accordance with the
                           current LMA recommended formula) sufficient to
                           indemnify the Lender for the costs (if any) imputed
                           to the Lender of compliance with the requirements of
                           the Financial Services Authority or the European
                           Central Bank in respect of the Close Out Advance;

         (b)      Interest payable on the Close Out Advance shall be calculated
                  by reference to interest periods (each an "INTEREST PERIOD"):

                  (i)      the first Interest Period shall commence on the Close
                           Out Date and end on the day before the next Rollover
                           Date for outstanding Advances under the Facility
                           Agreement;

                  (ii)     subsequent Interest Periods shall have a duration of
                           one month or such other period as the Lender and the
                           Company may agree; and

                  (iii)    to the extent practicable, Interest Periods shall be
                           managed in order to ensure that the last day of each
                           Interest Period for the Close Out Advance shall fall
                           on the due date for the payment of interest on the
                           outstanding Advances under the Facility Agreement;

         (c)      Interest due from the Company under this Letter shall:

                  (i)      accrue from day to day at the rate calculated under
                           (a) above;

                  (ii)     be payable in arrear on the last day of each Interest
                           Period; and

                  (iii)    be calculated on the basis of the actual number of
                           days elapsed and a 360 day year.

5.       REPAYMENT

         The Close Out Advance shall be repayable by the Company (together with
         interest accrued thereon and any other amounts due or owing to the
         Lender under this Letter at such time) upon the demand of the Lender at
         any time (the "REPAYMENT DATE"), provided that the Lender shall not
         make demand until the earlier of:

         (a)      the date on which the Agent serves notice of acceleration
                  pursuant to the terms of the letter dated 22 March 2002 from
                  the Company and Marconi plc to the Agent;

         (b)      the date on which (i) a resolution is passed at a meeting of
                  the Company for (or to petition for) its winding up, or (ii)
                  the Company presents any petition for its winding up or
                  administration, or (iii) an order for the winding up or

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                  administration of the Company is made, or (iv) analogous
                  procedures occur in relation to the Company in any other
                  country (including without limitation any moratorium or
                  suspension of payment proceedings and any voluntary or
                  involuntary proceedings under the United States Bankruptcy
                  Code);

         (c)      the date on which any scheme of arrangement in respect of the
                  Company is not approved by the relevant class of creditors at
                  the relevant meeting of creditors and/or such scheme is not
                  sanctioned at the relevant court hearing; or

         (d)      25 March 2003 or such other date as the Company and the Lender
                  may agree in writing;

6.       COSTS AND EXPENSES

         The Company shall promptly on demand pay the Lender the amount of all
         costs and expenses (including legal fees) reasonably incurred by any of
         them in connection with the negotiation, preparation, printing and
         execution of this Letter;

7.       ILLEGALITY

         If it becomes unlawful or contrary to any regulation in any
         jurisdiction for the Lender to give effect to any of its obligations as
         contemplated by this Letter or to fund or maintain the Close Out
         Advance, then the Lender may notify the Company accordingly and
         thereupon the Company shall, to the extent required and within the
         period allowed by such regulation or, if no period is allowed,
         forthwith, repay the Close Out Advance (together with interest accrued
         thereon and any other amounts due or owing to the Lender under this
         Letter at such time) PROVIDED THAT, without in any way limiting,
         reducing or otherwise qualifying the rights of the Lender, the Lender
         shall promptly upon becoming aware of the same notify the Company
         thereof and the Lender shall endeavour to transfer its rights and
         obligations in respect of the Close Out Advance to another financial
         institution not affected by the circumstances giving rise to such
         illegality, and shall otherwise take such reasonable steps as may be
         open to it to mitigate such circumstances. The Lender is not, however,
         required to take any action which would be prejudicial to it or which
         would conflict with its general banking policies, or give rise to any
         material cost or expense;

8.       PARI PASSU STATUS

         All claims of the Lender under this Letter shall rank pari passu with
         the claims of the Finance Parties under the Facility Agreement;

9.       TRANSFER

         The Lender may, following reasonable consultation with the Company,
         assign, transfer, novate or dispose of any of, or any interest in, its
         rights and/or obligations under this Letter to an Affiliate or to
         another bank or financial institution;

10.      CONFIDENTIALITY

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         The Lender may disclose to any of its Affiliates or any person with
         whom it is proposing to enter, or has entered into, any kind of
         transfer, participation or other agreement in relation to this Letter:

         (i)      a copy of this Letter; and

         (ii)     any information which the Lender has acquired under or in
                  connection with this Letter;

         PROVIDED THAT the Lender shall not disclose any such information to a
         person unless that person has provided to the Company a confidentiality
         undertaking addressed to the Company in such form as the Company may
         reasonably require.

11.      DEFAULT INTEREST

         (a)      If the Company fails to pay any amount payable by it under
                  this Letter, it shall forthwith on demand by the Lender pay
                  interest on the overdue amount from the due date up to the
                  date of actual payment, both before and after judgment, at a
                  rate (the "DEFAULT RATE") determined by the Lender to be one
                  per cent. per annum above the rate which would have been
                  payable if the overdue amount had, during the period of
                  non-payment, constituted a Close Out Advance in the currency
                  of the overdue amount for such successive Interest Periods of
                  such duration as the Lender may determine (each a "DESIGNATED
                  TERM").

         (b)      The default rate will be determined two Business Days before
                  the first day of the relevant Designated Term.

         (c)      Default interest will be compounded at the end of each
                  Designated Term.

12.      TAXES

         (a)      All payments by the Company under this Letter shall be made
                  free and clear of and without deduction for or on account of
                  any Applicable Taxes (and for the purposes of this Letter, the
                  reference to "Borrower" in the definition of Applicable Taxes
                  in the Facility Agreement shall be deemed to be a reference to
                  the Company) except to the extent that the Company is required
                  by law to make payment subject to any Applicable Taxes.
                  Subject to paragraph (b) below, if any Applicable Taxes or
                  amounts in respect of Applicable Taxes must be deducted or
                  withheld from any amounts payable or paid by the Company to
                  the Lender under this Letter, the Company shall pay such
                  additional amounts as may be necessary to ensure that the
                  Lender receives and retains (after any deduction or
                  withholding in respect of such additional amounts) a net
                  amount equal to the full amount which it would have received
                  and so retained had payment not been made subject to
                  Applicable Taxes.

         (b)      The Company is not obliged to pay any additional amount
                  pursuant to paragraph (a) above in respect of any deduction
                  which would not have been required if the Lender had obtained
                  any exemption from the deduction or withholding of Applicable
                  Taxes which it is able to obtain.

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         (c)      The Company will, within thirty days of the later of:

                  (i)      any payment being made in respect of which tax is
                           required by law to be deducted or withheld; or

                  (ii)     the date on which the Company is required to account
                           for the amount deducted or withheld to the
                           appropriate tax authority,

                  deliver to the Lender evidence (including any relevant tax
                  receipts) that the amount deducted or withheld has been duly
                  accounted for to the appropriate tax authority.

         (d)      The provisions of Clause 12.2 (a) (Qualifying Bank) of the
                  Facility Agreement shall apply in the same manner to the
                  Company's obligations under this paragraph 2 (with such
                  conforming changes as may be necessary to give effect to the
                  provisions of this Letter and the transactions contemplated
                  hereunder, including without limitation:

                  (i)      references to the "Signing Date" shall be deemed to
                           be references to the date of this Letter;

                  (ii)     references to "Bank" and "Obligor" shall be deemed to
                           be references to respectively the Lender and the
                           Company; and

                  (iii)    sub-paragraph (iii) of Clause 12.2(a) of the Facility
                           Agreement shall be deemed to refer to an assignment,
                           transfer, novation or disposition by the Lender
                           pursuant to paragraph 9 of this Letter).

         (e)      The provisions of Clause 12.5 (Tax Credit) of the Facility
                  Agreement shall apply in the same manner to any payment made
                  by the Company pursuant to this paragraph 2 (with such
                  conforming changes as may be necessary to give effect to the
                  provisions of this Letter and the transactions contemplated
                  hereunder, including without limitation:

                  (i)      references to "Obligor" shall be deemed to be
                           references to the Company;

                  (ii)     references to "Finance Party" and "Bank" shall be
                           deemed to be references to the Lender;

                  (iii)    references to "Finance Document" shall be deemed to
                           be references to this Letter; and

                  (iv)     references to all or any part of Clause 12 of the
                           Facility Agreement shall be deemed to be references
                           to paragraph 2 of this Letter).

13.      INCREASED COSTS

         (a)      Subject to paragraph (c) below, the Company shall within five
                  Business Days of demand by the Lender pay the Lender the
                  amount of any increased cost incurred by it or any of its
                  holding companies as a result of any change in (or change in
                  any official or judicial interpretation of) or introduction of
                  any law or regulation

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<PAGE>

                  (including any relating to taxation or reserve asset, special
                  deposit, cash ratio, liquidity or capital adequacy
                  requirements or any other form of banking or monetary
                  control).

                  For the purposes of this Letter "INCREASED COST" shall have
                  the meaning given to such term in Clause 15.1(b) of the
                  Facility Agreement, PROVIDED THAT:

                  (i)      references to "Finance Party" or "Party" shall be
                           deemed to be references to the "Lender";

                  (ii)     references to "Advance(s)" shall be deemed to be
                           references to the Close Out Advance; and

                  (iii)    references to "Agreement" shall be deemed to be
                           references to this Letter.

         (b)      The Lender shall notify the Company promptly upon becoming
                  aware that it has incurred an increased cost as a result of
                  any law or regulation referred to in paragraph (a) above and
                  shall provide calculations in reasonable detail of the basis
                  of such increased cost and its allocation to this Letter.

         (c)      Paragraph (a) does not apply to any increased cost:

                  (i)      compensated for by the payment of the costs referred
                           to in sub-paragraph (a)(iii) of paragraph 4 of this
                           Letter; or

                  (ii)     any part of which is attributable to the delay by the
                           Lender in notifying the Company of the increased
                           cost; or

                  (iii)    attributable to any tax or amounts in respect of tax
                           which must be deducted from any amounts payable or
                           paid by the Company to the Lender under this Letter
                           (or which would have been payable but for paragraph
                           12(d); or

                  (iv)     which is, or is attributable to, any tax on the
                           overall net income, profits or gains of the Lender or
                           any of its holding companies (or the overall net
                           income, profits or gains of a division or branch of
                           the Lender or any of its holding companies); or

                  (v)      resulting from the Lender breaching a regulation
                           imposed on it after the date of this Letter by any
                           fiscal, monetary or other regulatory authority.

14.      ENFORCEMENT COSTS

         The Company shall within five Business Days of demand pay to the Lender
         the amount of all reasonable costs and expenses (including legal fees)
         properly incurred by it in connection with the enforcement of, or the
         preservation of any rights under this Letter.

15.      STAMP DUTIES

         The Company shall pay and within five Business Days of demand indemnify
         the Lender against any liability it incurs in respect of any stamp,
         registration and similar tax which is or becomes payable in the U.K.
         directly attributable to the entry into, performance or

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<PAGE>

         enforcement of this Letter (other than in respect of any assignment,
         transfer, novation or disposition by the Lender pursuant to paragraph 9
         of this Letter).

16.      MISCELLANEOUS PROVISIONS

         The provisions of Clauses 27.3 (Waivers and remedies cumulative) and 32
         (Severability) of the Facility Agreement shall apply in the same manner
         to this Letter, with such conforming changes as may be necessary,
         including without limitation:

         (i)      references to the "Finance Documents" shall be deemed to be
                  references to this Letter; and

         (ii)     references to the "Finance Party" shall be deemed to be
                  references to the Lender.

17.      NOTICES

         Any notice or demand to be served by one person on another pursuant to
         this Letter may be served by leaving it at the address specified below
         (or such other address as such person may have most recently specified)
         or by letter posted by prepaid first-class post to such address (which
         shall be deemed to have been served on the second Business Day
         following the date of posting), or by fax to the fax number specified
         below (or such other number as such person may most recently have
         specified) (which shall be deemed to have been received when actually
         received by the recipient marked for the attention of the department or
         officer (if any) specified by the recipient for such purpose).

         Address for notices:

         COMPANY:

         Address:            1 Bruton Street
                             London W1J 6AQ

         Fax:                (020) 7493 1974

         Attention:          Group Treasurer/Group Assistant Treasurer

         THE LENDER

         Address:            125 London Wall
                             London EC2Y 5AJ

         Fax:                020 7777 4783

         Attention:          Mike Wharrad/Kay Walsh


18.      REPRESENTATIONS

         The Company hereby represents to the Lender that:

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<PAGE>

         (a)      it has been duly incorporated in accordance with its laws of
                  its place of incorporation and is validly existing;

         (b)      this Letter is within its powers and the execution, delivery
                  and performance thereof has been duly authorised;

         (c)      this Letter constitutes its legal, valid, binding and
                  enforceable obligation (subject to applicable bankruptcy,
                  reorganisation, insolvency, moratorium or similar laws
                  affecting creditors' rights generally and subject, as to
                  enforceability, to equitable principles of general
                  application); and

         (d)      this Letter and the transactions contemplated thereunder do
                  not and will not contravene in any material respect (i) its
                  constitutional documents, (ii) any law or regulation in its
                  country of incorporation, or (iii) any loan stock, debenture,
                  mortgage in respect of Borrowings to which it is a party.

19.      COUNTERPARTS

         This Letter may be executed in any number of counterparts and this has
         the same effect as if the signatures on the counterparts were on a
         single copy of this Letter.

20.      GOVERNING LAW AND JURISDICTION

         This Letter shall be governed by English Law and, for the Lender's
         benefit, the English courts shall have exclusive jurisdiction to settle
         any dispute which may arise from or in connection with it.

Please confirm your agreement to the above by signing and returning to us the
enclosed copy of this Letter.

Yours faithfully

Steve Hare (signed)
-------------------

For and on behalf of
MARCONI CORPORATION PLC

We hereby agree the above.

Mike Wharrad (signed)
---------------------

For and on behalf of
JPMORGAN CHASE BANK

                                     - 8 -

<PAGE>

                                   SCHEDULE 1

                                   "THE SWAPS"

INTEREST RATE SWAPS PURSUANT TO THE ISDA MASTER AGREEMENT DATED 30 SEPTEMBER
1999

<TABLE>
<CAPTION>
REFERENCE NUMBER                      EFFECTIVE DATE                      NOTIONAL AMOUNT
<S>                                   <C>                                 <C>
237458                                 1 July 1998                        USD250,000,000

238342                                 1 July 1998                        USD125,000,000

240076                                 1 July 1998                        USD125,000,000
</TABLE>

FOREIGN EXCHANGE SWAPS

<TABLE>
<CAPTION>
REFERENCE NUMBER                      MATURITY DATE                       NOTIONAL AMOUNT
<S>                                   <C>                                <C>
55923421                              30 August 2002                     USD5,218,831.75 at
                                                                         USD1.4040
                                                                         (GBP3,717,116,63)

46758691                              30 August 2002                     USD3,345,058.15 at
                                                                         USD1.3935
                                                                         (GBP2,400,472.30)
</TABLE>

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