NTL on Friday stood by its £817m offer for Virgin Mobile despite suggestions by Sir Richard Branson that an additional £25m would seal the deal.
Sir Richard said in a radio interview that Virgin’s minority shareholders wanted an additional £25m to agree to a takeover. His comments followed the mobile operator’s rejection of NTL’s initial bid at 323p a share.
Virgin Mobile, and now NTL, have sought to distance themselves from Sir Richard’s public intervention in the bid process.
NTL said on Friday it “had no prior knowledge” of the comments made by the Virgin side.
The Nasdaq-listed group added that it “continues to believe that its potential offer of 323p per Virgin Mobile share represents better value, for all Virgin Mobile shareholders, than Virgin Mobile’s stand-alone alternatives.”
Shares in Virgin Mobile, which have risen 14 per cent since NTL’s was made, gained another 0.5 per cent on Friday to stand at 357p.
NTL said it had noted the recent rise in the mobile operator’s share price and retained the right to make a lower offer for the group with the agreement of the Virgin Mobile board.
Virgin Mobile was forced to issue a rebuttal of the comments made on Thursday by Sir Richard, whose Virgin Group controls 72 per cent of the company.
After talking to the Takeover Panel on Thursday, Virgin Mobile issued a statement amid concerns that investors could start questioning the company’s corporate governance.
The company said the board had “only considered the 323p per share potential offer price announced by NTL”, adding: “It did not consider any other price, nor did it solicit another price.”
The additional £25m cited by Sir Richard would equate to a price of 357p, significantly higher than the opening offer and just above Thursday’s closing price of 355p.
“We’re talking about only £25m difference between what the independent shareholders are talking about and what NTL have offered . . . my feeling is that they will be able to reach a deal,” Sir Richard said.
He had earlier this week given his backing to the NTL deal in principle.
Simon Duffy, NTL’s chief executive, is not expected to walk away from the opportunity of buying into the Virgin brand.
Additional reporting by Clay Harris