Britain’s two cable operators, NTL and Telewest, may finally tie the knot in early 2004, according to the latter firm’s boss Charles Burdick.
The US-owned duo have been the subject of seemingly endless merger speculation – much of it fuelled by leaks from the companies themselves. However, for the first time one of the parties has come out and set a date.
Telewest managing director Burdick believes the company can complete its financial restructuring – a debt-for-equity swap that will halve its £5.3 billion ($8.6bn; €8bn) debts – in the second quarter of 2003, break even by Q4 and merge with NTL at the start of next year.
“Our plans show the second quarter of 2004 as cash-flow positive but I have the team focused on internal targets that move that up to the fourth quarter of 2003,” he said. “If Telewest meets that target, it will be the first cable company in the world to turn cash-flow positive.”
This timescale correlates with recent comments by an anonymous ‘senior cable industry’ source [WAMN: 29-Jan-03]. “I would be surprised if we didn't see something by spring next year,” the cloaked figure advised last month.
The major obstacle to a merger thus far has been the size of the two firms’ debts – a hurdle now cleared by Telewest’s ongoing restructuring and a similar scheme recently completed by NTL.
But there remains one major sticking point – which firm’s management will take control. Unsurprisingly, Burdick thinks it should be Telewest, even though it is the smaller firm.
“Look at the continuity of management at Telewest,” he implored. “We haven't done a major acquisition for three years and our restructure was much less disruptive to the organisation than theirs. So most people say we are in much better shape.”
Data sourced from: MediaGuardian.co.uk; additional content by WARC staff