ntl goes quad-play with completion of Virgin Mobile acquisition

4 Jul 2006

UK cable giant ntl Incorporated has completed its takeover of mobile virtual network operator (MVNO) Virgin Mobile UK, rubber stamping its transformation into a quadruple-play internet, TV and fixed and mobile telephony provider. ntl said it received all necessary court approvals for the deal and the acquisition of Virgin Mobile has been completed, with the MVNO’s shares now de-listed from the London Stock Exchange. ntl made an initial bid for Virgin Mobile in December 2005 as part of its plans to merge with fellow cableco Telewest (since completed) and form a giant quadruple-play service provider capable of taking on BT and pay-TV leader BSkyB. The first offer was rejected by Virgin Mobile’s minority shareholders, but ntl returned with a better price in April and – with the support of owner Sir Richard Branson and the Virgin Group – struck a deal to acquire the MVNO. ntl returned with an offer of 372p per share in cash for the cellco’s minority shareholders, or 0.23245 ntl shares, or a mix of ntl shares and cash. Sir Richard has accepted a mixture of cash and ntl shares, to take a major stake in the new company. Under a separate deal, ntl agreed to license the Virgin brand for 30 years. For the time being, however, ntl and Virgin Mobile continue to operate as separate organisations and brands, with no change to the services or terms and conditions of either company’s customers. It is anticipated that the merged company will start marketing a single portfolio of services under the Virgin brand some time in early 2007, if not sooner.

United Kingdom, Virgin Media, Virgin Mobile UK