NTL in GBP 817m bid for Virgin Mobile
More operator consolidation looms in the UK
Cable television and telecommunications firm NTL has made an offer of GBP 817 million for one of the UK's only remaining independent mobile network operators, Virgin Mobile.
The move would create the country's first "quadruple-play" operator - capable of providing cable television, telephone, broadband internet and mobile telephony services through a single offering.
It comes only weeks after the board of another major UK mobile operator, O2, approved a takeover bid by Spanish telecommunications giant Telefonica, and would create one of the largest companies in the sector in Britain, with a market capitalisation of GBP 4.5 billion.
Under the terms of the deal, Virgin Mobile would retain its brand and the Virgin brand is likely to be applied across the range of services offered by NTL and Telewest, the rival cable TV and communications firm with which NTL has recently merged.
Richard Branson, the well-known founder of the Virgin group of businesses, would sell his 71 per cent stake in Virgin Mobile to NTL, taking in return a 14 per cent stake in the merged company.
While the offer remains just that - an offer - at present, some analysts expect a bidding war to result, with other possible suitors including Rupert Murdoch's BSkyB, which runs satellite television services across the UK and recently acquired broadband provider Easynet, or rival mobile firms Vodafone or France Telecom owned Orange.
NTL and Virgin have worked together on some business partnerships before - in the mid-nineties, the two firms launched Virgin Net, a Virgin-branded internet service provider which was taken over by NTL last year and continues to trade with the Virgin brand.