Both Vodafone and France Telecom are now considering a rival bid for Virgin Mobile, following a “unanimous” decision by the Virgin board to reject the starting offer from NTL. Financial sources say both companies have asked to look at the Virgin Mobile books.
This means that if NTL wants to buy the brand and put it on all NTL products, it will have to come up with a bigger offer. NTL, waiting for the Stock Exchange to open before making any announcement, is going to have trouble finding the money after its big takeover offer for Telewest, say finance analysts.
It also means a nasty gap in the future of T-Mobile, which provides the network for Virgin as a virtual network; neither France Telecom nor Vodafone would renew that contract, and the loss could be crushing, following T-Mobile’s defeat in the contest to buy O2.
Virgin founder Sir Richard Branson has told reporters he is sure the deal will go ahead.
From Australia, Forbes quotes Branson as saying that the new company will be formed and will be called Virgin TV – all it will take, he added, is a small increase in the offer. He said the current offer under-valued the company in the eyes of his fellow directors, but that “the difference between what they’ve asked for and what NTL has offered is not considerable in financial terms.”
According to the Times, the difference is between the current offer of £817 million and a hoped-for bid of £891m – increasing the bid to 345 per share while the Guardian thinks the extra needed is rather less at 340 pence.
Guy Kewney write extensively, and quite brilliantly, in lots of places, including NewsWireless.net