Private equity groups target Virgin Media: paper
LONDON (Reuters) - Four private equity groups are actively considering launching a takeover bid for British cable operator Virgin Media (VMED.O) despite continuing turmoil in the credit markets, the Observer newspaper reported.
According to documents seen by the paper entitled "Project Coaxial", Blackstone (BX.N), Cinven CINV.UL, Kohlberg Kravis Roberts KKR.UL and Providence Equity are prepared to offer $6 billion to $7.5 billion for the company in which Richard Branson's Virgin Group holds a 10.5 percent stake.
The consortium is being advised by Merrill Lynch, Morgan Stanley and Perella Weinberg Partners, the paper said, and the advisers provide analysis for bid prices ranging from $17 to $21 a share but say nothing about timing.
The predators are set to take advantage of Virgin Media's weak share price which slipped to $14 last week, but the paper added it is uncertain whether the private equity groups could secure funding after last summer's liquidity crisis.
A Virgin Media spokeswoman decline to comment.
Private equity group Carlyle Group CYL.UL made an initial offer last July but withdrew it soon afterwards following problems in the credit markets, sources told Reuters at the time.
Virgin Media, Britain's second-largest pay-TV operator, was formed from the merger of cable operators NTL, Telewest and Virgin's mobile phone division to bundle television, broadband, mobile and fixed-line telephony in a series of price packages.
Virgin Media trades in Britain but is listed on the Nasdaq.
(Reporting by David Jones; Editing by David Cowell)
