Some Virgin minority investors hoping for higher price
Analysts were waiting Tuesday to see if NTL would increase its bid for Virgin Mobile, as predicted in a weekend newspaper report.
London’s Sunday Times said NTL, Britain’s largest cable operator, would boost its $1.4 billion offer for Virgin by 10% sometime in the coming weeks.
Virgin Mobile majority owner Richard Branson backs a deal with NTL, but some minority investors on the board want a higher price. It remains to be seen if 10% would change their minds.
Branson would retain about 15% of the combined company, which would offer British subscribers “four-play” mobile and fixed-line phone services along with broadband Internet and television.
U.K. regulator the Office of Fair Trading cleared NTL’s $5.78 billion takeover of rival Telewest on Friday. The OFT said there was no justification for referring the deal, intended to provide serious competition for the U.K.’s leading paybox, BSkyB, to the Competition Commission.
The OFT said NTL’s and Telewest’s local networks did not overlap or compete in providing cable services.
NTL recently appointed American cable topper Stephen Burch as its CEO.
The watchdog also greenlit BSkyB’s $358 million purchase of Internet company Easynet. The OFT said the acquisition would benefit customers by providing a triple play of TV, phone and Internet services for the first time.
Competitors had raised concerns about BSkyB’s potential for blocking the supply of pay TV content to rivals, it said. But the regulator ruled that since BSkyB already has the potential to do this, the merger “does not materially alter its incentives.”
NTL and Telewest, both listed on the Nasdaq, have customers in about 5 million U.K. households, compared with 8 million for BSkyB.
(United Press Intl. contributed to this report.)