Complexity of multiterminal cuts

In the multiterminal cut problem one is given an edge-weighted graph and a subset of the vertices called terminals, and is asked for a minimum weight set of edges that separates each terminal from all the others. When the number k of terminals is two, this is simply the mincut, max-flow problem, and can be solved in polynomial time. It is shown that the problem becomes NP-hard as soon as k = 3, but can be solved in polynomial time for planar graphs for any fixed k. The planar problem is NP-hard, however, if k is not fixed. A simple approximation algorithm for arbitrary graphs that is guaranteed to come within a factor of 2 - 2/k of the optimal cut weight is also described.