Telewest Buys Outstanding Shares of Cable London

The UK’s second largest cable company,
Telewest Communications, has
agreed to purchase from NTL the remaining 50 per cent of Cable London
for £428 million ($680 million).

Earlier this month, Microsoft and Telewest announced a strategic alliance
to deliver broadband and Internet services in the UK — an alliance which is
clearly being strengthened by Thursday’s deal.

To pay for the acquisition, Telewest has organised a 1 for 11 rights issue at 213
pence per share, with Microsoft and Liberty Media agreeing in principle
to take up rights (approximately 50 per cent of the issue) and underwrite
the balance.

“This will significantly expand our footprint in the capital,” said
Tony Illsley, CEO of Telewest.

“We look forward to taking control of this strategically important
franchise and exploiting its broadband potential in the residential
and business market. We are also delighted at Liberty Media and Microsoft’s
support for the rights issue which demonstrates their commitment to
the company and strengthens its capital structure.”

Cable London brings networks in the boroughs of Camden, Islington,
Hackney and Enfield in the north and east of London, greatly
expanding Telewest’s footprint in the capital.

Although it has over 200,000 telephone and cable television customers,
Cable London also has net liabilities of £23.6 million
($37.7 million), including bank borrowings of £115 million
($184 million). It generated sales of £70 million ($112 million)
in 1998.