Credit crunch prompts Virgin Media bid to shift debt mountain
Eases off on cable outlay
Virgin Media has persuaded banks to hold off calling in billions of pounds of debt from 1990s cable rollouts until 2012.
Traders in New York, where the firm is listed, liked the plan and sent its stock up 25 per cent yesterday. Virgin Media beancounters still require permission to restructure the £4.3bn of loans from some creditors, but the ten biggest are already on board.
Under existing arrangements Virgin Media had been due to begin repaying the banks early 2010. The firm told the Financial Times that it had already planned to ask for a reprieve, but brought the move forward in light of the turmoil in global credit markets.
Rumours have been flying that Virgin Media would have to sell major parts of its business in order to meet its debt obligations. The proposed new repayment schedule would significantly ease such pressure. ®