Take over bid set for Virgin Media
Updated on 02 July 2007
Virgin Media, the UK's leading cable television company, is set to be taken over by a private equity firm for more than £5bn.
Carlyle, one of the world's leading private equity groups, has made a preliminary offer - and other firns are also considering a bid.
The move is expected to trigger an auction of the business, which last year completed a merger with NTL Telewest.
It is almost a year since a consortium made up of US buy-out group Providence Equity, Blackstone Group, KKR and Cinven made a failed approach for NTL.
Any new owner would have to buy out or work in partnership with Sir Richard Branson's Virgin Group, which is the largest shareholder with a 10.5% stake.
Carlyle has substantial experience in the cable market and owns Insight Communications, which is among the 10 largest cable firms in the US. Providence also owns a number of US and European TV companies.
The merger of NTL and Virgin Media - which was structured as a £962.4m takeover of Virgin - created a company offering the "quadruple play" of cable TV, broadband internet access, fixed telephone and mobile phone services.
But shares have come under pressure after a row over prices led to Sky's basic channels being withdrawn from the Virgin service at the end of February.
Virgin Media has started High Court proceedings against its rival in a bid to resolve the dispute and said it will seek compensation for any financial losses caused as a result of the row.
BSkyB is expected to file its response to Virgin Media's lawsuit this week.
