Virgin Mobile board rejects NTL offer

Iria · Dec 8, 2005, 03:35 PM

The board of Virgin Mobile rejected a $1.42 billion takeover approach from U.K. cable operator NTL on Wednesday evening, saying it undervalues the company.

Virgin Mobile is 72 percent owned by British entrepreneur Richard Branson, who had already agreed to swap his holdings for NTL stock and some cash if a deal proceeded. Gordon McCallum, representing Branson's Virgin Group, absented himself from the Virgin Mobile board's discussions.

NTL approached Virgin Mobile, the U.K.'s fifth-largest mobile operator, with a cash or shares buyout offer on Monday, aiming to create a TV, Internet, fixed-line and mobile phone powerhouse under the Virgin brand. NTL was not immediately available for comment.

"The board has concluded that the potential offer materially undervalues Virgin Mobile," the company said in an e-mailed statement.

One analyst said the decision suggested that Virgin Mobile would still be open to a deal at a higher price.

"Virgin is trying to start a bidding war by rejecting the offer on the premise that the price isn't right rather than saying the company is not for sale," said Charter Equity Research analyst Ed Snyder.
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Dec 8, 2005, 03:35 PM	#1
Iria DriverHeaven Extreme Member Join Date: Apr 2004 Posts: 7,275 Rep Power: 87	Virgin Mobile board rejects NTL offer The board of Virgin Mobile rejected a $1.42 billion takeover approach from U.K. cable operator NTL on Wednesday evening, saying it undervalues the company. Virgin Mobile is 72 percent owned by British entrepreneur Richard Branson, who had already agreed to swap his holdings for NTL stock and some cash if a deal proceeded. Gordon McCallum, representing Branson's Virgin Group, absented himself from the Virgin Mobile board's discussions. NTL approached Virgin Mobile, the U.K.'s fifth-largest mobile operator, with a cash or shares buyout offer on Monday, aiming to create a TV, Internet, fixed-line and mobile phone powerhouse under the Virgin brand. NTL was not immediately available for comment. "The board has concluded that the potential offer materially undervalues Virgin Mobile," the company said in an e-mailed statement. One analyst said the decision suggested that Virgin Mobile would still be open to a deal at a higher price. "Virgin is trying to start a bidding war by rejecting the offer on the premise that the price isn't right rather than saying the company is not for sale," said Charter Equity Research analyst Ed Snyder. ___________ Read More / Source: News.com