Log in
Login
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  News  >  Business Leaders  >  All news

Business Leaders

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesHot NewsMost Read NewsRecomm.Business LeadersCalendar 
HomeAll newsMost read newsBusiness Leaders Biography 
Birthday : 03/11/1931
Place of birth : Melbourne - Australia
Biography : Mr. Keith R. Murdoch is Executive Co-Chairman at News Corp., Chairman & Chief Executive Officer at R

Malone eyes Virgin Media in challenge to Murdoch

share with twitter share with LinkedIn share with facebook
share via e-mail
0
02/05/2013 | 12:44pm CEST

John Malone's Liberty Global has opened talks with Britain's Virgin Media over a takeover that would increase the U.S. cable group's dominance in Europe and step up a challenge to media mogul Rupert Murdoch.

Virgin Media, the No. 2 pay-TV group in Britain behind Murdoch's satellite group BSkyB, has a valuation including debt of around $20 billion.

A deal would give Liberty entry to one of Europe's biggest telecom markets and allow it to apply lessons learned as a pay-TV and broadband provider in 11 other European countries.

Malone's Liberty could offer one of the sternest challenges to Murdoch as cable groups across the region start to assert their authority over traditional telecoms firms with the offer of super-fast broadband and pay-television.

Malone, whose group has 19.6 million customers, came up against Murdoch a decade ago when Murdoch's News Corp. and Liberty Media vied for control of DirecTV Group, the largest U.S. satellite TV broadcaster.

The stand-off ended when both sides backed off. News Corp. sold its one-third stake in DirecTV to Malone's group and Malone sold 16 percent of News Corp. that Liberty had acquired, giving the Murdochs fuller control over News Corp.

Buying Britain's second-biggest pay-TV company would put Malone up against Murdoch's satellite group BSkyB, which leads the British pay-TV market with 10.7 million customers compared with Virgin's 4.9 million.

It could also leave the combined group weighed down with heavier debts.

Virgin Media's bonds widened and the cost of insuring its debt rose on expectations that more debt would have to be raised to finance a deal. It is also rated higher than Liberty Global, which could impact its credit profile.

Virgin Media's main listing is in the United States but it has a smaller one in London, where the shares were up 14 percent in early trading.

News Corp owns 39 percent of BSkyB. Murdoch tried to buy the rest in 2010 but had to drop the $12 billion bid due to public outrage over a phone hacking scandal. Shares in BSkyB were down 1 percent against a FTSE 100 Index which was up 0.3 percent.

Virgin Media, which confirmed the talks with Liberty in a brief statement, has a market value of $10.6 billion and $9 billion of debt.

It made its first annual profit in 2011 after a turnaround engineered by Chief Executive Neil Berkett and a takeover could make Virgin more aggressive in the British market. Virgin reports its 2012 results on Wednesday.

"Virgin Media confirms that it is in discussions with Liberty Global, a leading international cable company, concerning a possible transaction," it said.

Analysts at Espirito Santo said they believed a fair enterprise value for Virgin Media would be around $24 billion, although they questioned how Liberty would pay for it.

Espirito put Liberty's net debt at 5 times its core earnings.

LEGAL BATTLE

Virgin Media was formed by the merger of cable groups Telewest and NTL and mobile operator Virgin Mobile in 2006. It uses the brand of Richard Branson's Virgin Group and the British entrepreneur retains a 3 percent stake.

The company sells cable TV, telephony and broadband and also competes with a television service from BT called BT Vision and online offerings such as Lovefilm.

Its biggest shareholders are Capital World Investors which own 14.6 percent and Capital Research Global Investors which own 10.9 percent, according to Reuters data.

Virgin Media spent the first few years of its existence engaged in a long legal with BSkyB over access to content.

Berkett shunned that approach after he took over in 2008, settling the dispute and slowly building up Virgin Media's customer base by focusing on a superior broadband offering.

Its share price has responded in turn, soaring almost 160 percent since March 2008.

A deal to become part of the wider Liberty group would not necessarily result in huge synergies because there are few links between cable networks in different countries, but it could help produce savings in buying equipment.

Liberty has recently increased its stake in Belgian operator Telenet to 58 percent and owns other consumer brands across Europe including UPC, Unitymedia, Kabel BW and VTR.

It also owns a content and channels group called Chellomedia.

(Reporting by Kate Holton; Additional reporting by Josie Cox; Editing by James Davey and Tom Pfeiffer)

By Kate Holton

Stocks treated in this article : Liberty Global Inc., Virgin Media Inc.
share with twitter share with LinkedIn share with facebook
share via e-mail
0
React to this article
Latest news about Rupert Murdoch 
01/30DJRUPERT MURDOCH : Sky Reappoints Murdoch To Post
01/29 RUPERT MURDOCH : James Murdoch, who quit in phone-hacking scandal, returns as Sky chairman
2015 RUPERT MURDOCH : Tribune Publishing says not in talks to sell itself after Murdoch tweet
2015 RUPERT MURDOCH : Tribune papers likely to be sold, LA Times split off
2015DJRUPERT MURDOCH : Video Ads Like Facebook's 'Not Really Earning Anybody's Attention'
2015DJRUPERT MURDOCH : Elisabeth Murdoch Launching Mobile Video Company Vertical Networks
2015DJRUPERT MURDOCH : Fox Says Value of Rupert Murdoch's Pay Fell in Final Year as CEO
2015DJRUPERT MURDOCH : Fox Says Value of Rupert Murdoch's Pay Fell in Final Year as CEO
2015DJRUPERT MURDOCH : Rupert Murdoch's Pay Falls at News Corp
2015 RUPERT MURDOCH : Prosecutor seeks to summon Murdoch in Deutsche Bank trial
2015DJRUPERT MURDOCH : Fox Reports Better-Than-Expected Earnings
2015DJRUPERT MURDOCH : Fox Details Pay for James, Lachlan Murdoch
2015 RUPERT MURDOCH : James Murdoch says family is united as he takes helm of Fox
2015DJRUPERT MURDOCH : Murdoch Succession Plan Means New Bosses for Ailes
2015 RUPERT MURDOCH : Chase Carey to stay at Fox to advise newly promoted Murdoch sons
1  2  3  4  5  6  7  8  9  10Next

Advertisement
Most Read News 
06/23 ELON MUSK : Behind Tesla carnage, signs of support for Musk's SolarCity deal
06/24 DAVID HENRY : U.S. banks flex capital muscle in annual stress test
06/22 ELON MUSK : Tesla offers $2.8 billion for SolarCity in 'no brainer' deal for Musk
06/22DJSHIGENOBU NAGAMORI : SoftBank Investors Cheer CEO's Decision to Stay On
06/25 GEORGE SOROS : Investor George Soros calls for reconstruction of EU after 'Brexit' vote
06/23 TERRY LUNDGREN : Longtime Macy's CEO Lundgren to step down next year
06/23 SUMNER REDSTONE : Viacom board stays in place as judge steers away from Redstone competence question
More news

Popular Business Leaders 
Paul Achleitner William Ackman Aldemir Bendine Jeff Bezos Martin Blessing Vincent Bolloré Martin Bouygues Warren Buffett Tim Cook Philippe Dauman Michael Dell Patrick Drahi Klaus Engel Federico Ghizzoni Carlos Ghosn Mario Greco Philip Green Herbert Hainer Guy Hands Carl Icahn Jérôme Kerviel Susanne Klatten Robin Li Daniel Loeb Jack Ma Marissa Mayer Lakshmi Mittal Elon Musk Xavier Niel Frédéric Oudéa Joseph Papa Wolfgang Porsche Sumner Redstone Alexandre Ricard Charles Schwab Martin Senn George Soros Martin Sorrell Osamu Suzuki Tidjane Thiam Peter Thiel François Villeroy De Galhau Sam Walton Thomas Wilson Martin Winterkorn Dieter Zetsche Cyril Zimmermann Mark Zuckerberg Henri De Castries Isabel Dos Santos
A-Z Business Leaders