Virgin Media: Getting Caught In The Credit Crunch?
Richard Branson's Virgin Media , said it has delayed its sale until the environment improves enough for all interested parties to bid. The British billionaire Branson is the largest shareholder of this cable TV company, which received one bid from the Carlyle group for some $23 billion, and some nibbles from other private equity players.
Last week I blogged about Liberty Media's Chairman John Malone saying he's considering entering the auction for Virgin Media, (which he could have done with a partner). Now Branson must not be getting enough interest to keep the asset out on the market. Rather than get snubbed by investors anxious about the credit crunch, I'd bet he's hoping that if he waits until the market heats up again, and a possible bidding war will ensue. This would be one big deal--it would be the largest cable transaction outside the U.S.
That's not the only news for Virgin Media.On Thursday, Moody's Investors Service downgraded the company's credit rating to "negative" from "stable" on the heels of Virgin's second-quarter results, saying it had lost 70,300 customers. That was thanks largely to Virgin Media's battle with News Corp's BSkyB division, which stole 40,000 customers. And the company said that just 125,000 of its 4.7 million customers had signed up for its "quadruple play" --pay-TV, broadband, mobile, and home phone.
Quite the disappointment after Branson hyped that quadruple play as the company's big advantage. Still, he says he's positive for the year--but these results certainly don't help him fire up that bidding war.
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