NTL Shareholders Want Company To Shed ITV Takeover Plans

Frustration is brewing amongst NTL shareholders, who feel that the cable group should focus on integrating Telewest and Virgin Mobile rather than a bid to buy ITV, according to a report on mediaguardian.co.uk.

The ITV board unanimously rejected a merger bid by NTL recently, claiming there was “little, if any, strategic logic for ITV to combine with NTL” (see ITV Board Rejects NTL Merger Bid). The statement came after BSkyB bought an almost 18% stake of ITV in a deal worth close to £1 billion (see Branson Bites Back At Sky’s Swoop On ITV).

The cable group is awaiting the outcome of regulatory probes into BSkyB’s £940 million swoop on ITV shares, when it bought what most market players described as a blocking stake (see Ofcom To Discuss BSkyB’s ITV Acquisition).

Some big shareholders are understood to want NTL to ditch its aspirations for an ITV takeover altogether. Others believe BSkyB’s defensive move proves a combined NTL-ITV would be a strong competitor, but they are concerned a new bid could be a financial stretch too far.

The NTL chairman, Jim Mooney, lambasted the move by Sky as “anti-competitive”. One media banker said BSkyB had made new offers tough for potential bidders such as NTL, given it had “drawn a line in the sand” at 135p per share.

Furthermore, now ITV has snatched BBC chairman Michael Grade, shareholders could well prefer to give the broadcasting veteran a chance to turn things around rather than sell up, the banker said (see BBC Chairman Jumps Ship To ITV Top Job).

The cable firm plans to re-brand as Virgin Media next year and is on a drive to overhaul customer service and shake off a reputation that saw consumers nickname it “NT Hell” (see NTL To Become Virgin Media Early Next Year).

ITV: 020 7843 8000 www.itv.com