Merger negotiations ongoing, exex could shuffle
LONDON — The expected announcement of a merger between U.K. cabler Telewest and British cable and satellite TV programmer Flextech failed to materialize Thursday, despite widespread reports that a deal is done.
The lack of confirmation could indicate that there are problems with the loose ends of the negotiations, but most observers still see a deal as imminent.
According to reports, Telewest has agreed to buy Flextech for about £1.9 billion ($3 billion) in stock.
Though Telewest is the larger of the partners, Flextech chief exec Adam Singer is tipped to become chief exec of the merged company, while Telewest CEO Tony Illsley will become managing director.
One insider suggested that Illsley’s taking that post made sense given that Telewest has considerable work to do on the distribution side, such as the continuing rollout of its digital platform, which soft-launched at the end of October.
A merger — creating a group worth about $14.5 billion — is a logical move for both companies. The two share a major shareholder in U.S. conglom Liberty Media, which owns 21.6% of Telewest and a controlling 36.7% of Flextech. And combining Telewest’s distribution and Flextech’s programming under one roof will make for a more effective rival to satcaster BSkyB, the dominant player in U.K. pay TV.