Cable television network operator NTL has approached Virgin Mobile to discuss a possible takeover of the mobile phone network.
The proposed deal would see Virgin Mobile shareholders offered 0.09298 shares of NTL common stock per Virgin Mobile share they hold or a cash payment of £3.23 pence, NTL said. Virgin Mobile shares closed trading in London on Friday at 313 pence.
Sir Richard Branson owns 72 per cent of Virgin Mobile through his Virgin Group.
Virgin Group, which is the majority shareholder of the wireless carrier with a 72 per cent stake, has said that should the transaction proceed it intends to exchange most of its shares for those of NTL with possibly a small portion taken in cash, NTL said. Virgin Mobile is a mobile virtual network operator (MVNO) and T-Mobile, on which its service operates, has indicated support for the proposed takeover, NTL said.
The two companies are already working together in the broadband Internet field. NTL has an exclusive license for use of the Virgin brand name for broadband services and it in talks to extend that to include television and fixed and mobile telephony, it said.