Cable Colossi NTL and Telewest in First Step Toward Merger

09 August 2001

Britain’s two mainstream cable companies, NTL and Telewest – both US-owned – yesterday announced the first step towards their long expected merger.

Although fiscal merger is still a distant prospect as both companies are saddled with massive debt, a joint working party has been set up to explore product convergence, the pooling of subscribers and a national retail initiative.

To signify the importance of the alliance, the committee is headed by the companies’ respective managing directors – Stephen Carter of NTL and Philip Jansen of Telewest.

A second phase of the alliance would see the merging of their respective advertising operations and a joint campaign to promote ‘Broadband Britain’.

Says Jansen: “Everybody understands the rationale for the merger of these two businesses but in the meantime there are some benefits we can get from co-operation in certain areas.”

Carter, however, insists that a full merger is not a foregone conclusion: “We are working together to create value where it doesn't prevent us running our own businesses," he said.

Telewest’s current indebtedness stands at an eye-watering £4.8 billion, dwarfed by NTL’s Himalayan £10.9bn. Between them they boast around 1.5 million subscribers to their digital services [or as students of irrelevant statistics will have noted, a debt-to-customer ratio of 10,466].

News source: Financial Times