- George Zimmerman will not be charged in domestic dispute
- Russian officials press bilateral U.S. trade deal
- Selfies at Funerals blog creator retires after Obama flub: ‘Our work here is done’
- New Obama adviser Podesta is against Keystone but will steer clear of pipeline deliberations
- 40 Australian adults, children found in ‘one of the worst accounts of incest ever made public’
- Venezuela’s Maduro calls on student ‘price vigilantes’ to hit the streets, report businesses
- Atheists smug as Hindus join Satanists to demand display at Oklahoma Statehouse
- Bow before Valkyrie, NASA’s ‘superhero robot’ entry in DARPA challenge
- 10-year-old Pennsylvania boy suspended for pretend bow-and-arrow shooting
- Budget deal exposes GOP divisions; conservatives slam tax hikes, vague cuts
Liberty Global to buy Virgin Media for $16B
Question of the Day
NEW YORK (AP) - Liberty Global Inc., the cable TV operator controlled by media mogul John Malone, is buying U.K.-based Virgin Media Inc. in a $16 billion deal that steps up the rivalry between Malone and fellow billionaire Rupert Murdoch.
Liberty Global is paying $5.9 billion in cash and the rest in stock for Virgin Media. The combination, announced late Tuesday, will provide stiffer competition in the U.K. to satellite TV provider BSkyB, which Murdoch's News Corp. is the largest single shareholder in, with a stake of about 40 percent.
The combined Liberty Global-Virgin Media company will become one of the world's largest providers of cable TV, Internet and phone services, with 25 million customers in 14 countries.
"Liberty Global together with Virgin Media is a powerful combination," Liberty Global President and CEO Michael Fries said Wednesday on a conference call with investors. "In fact, it hits the mark on just about every strategic and operating criteria we have established for our company and provides significant benefits to Virgin Media subscribers and investors."
Liberty Global is the largest cable operator in most of its 11 European markets. Virgin Media is the second-biggest pay TV company in the U.K. after BSkyB, or British Sky Broadcasting Group PLC.
Fries said that after the deal, about 80 percent of the company's revenue will come from five countries: the U.K., Germany, Belgium, Switzerland and the Netherlands. The two companies said they had combined revenue of $16.8 billion last year.
Besides the cable TV, Internet and landline phone operations, Virgin Media runs a mobile phone business. That's a business Liberty Global doesn't currently have. Virgin Group boss Richard Branson _ a multibillionaire, like Malone and Murdoch _ has a minority stake in Virgin Media.
The companies said the transaction is equal to $47.87 per Virgin Media share. That's about a 24 percent premium on the closing price of Virgin Media's U.S.-traded stock on Monday. Each Virgin Media shareholder will get $17.50 in cash and get the rest of the value in Liberty Global stock.
"This deal delivers attractive value now and exposure to a very compelling growth equity story," Virgin Media CEO Neil Berkett said on the conference call, pointing to the stock premium.
Virgin Media's U.S. shares fell 72 cents, or 1.6 percent, to close at $44.89 on Wednesday, a day after surging almost 18 percent to close at $45.61 after the company acknowledged it was in acquisition talks with Liberty Global. Liberty Global's stock fell $1.82, or 2.7 percent, to $66.06.
Liberty Global's Englewood, Colo., headquarters and main U.S. offices will remain in place, and its shares will continue to trade on the Nasdaq Stock Market. But the company will change its legal headquarters to the U.K. by becoming a subsidiary of a new U.K.-based holding company, which Fries said will give it more strategic and financial flexibility.
Virgin Media will continue to operate under its namesake brand in the U.K.
The deal remains subject to approval by the shareholders of both companies and by regulators. Malone, who holds more than 35 percent of Liberty Global's stock, said he will vote in favor of the deal. The deal is expected to close by the end of June.
Existing Virgin Media shareholders will get about 36 percent of Liberty Global's outstanding shares and about 26 percent of the voting rights, the companies said. In addition, one of the company's board members will join Liberty Global's board. Berkett doesn't plan to stay with the combined company once the deal closes.
The companies added that they expect about $180 million in annual costs savings once they are fully combined. Liberty Global wouldn't say whether there will be any staff reductions as part of the cost cutting.
The moves are also expected to boost Liberty Global's cash flow and allow it to speed up its stock buyback plan. In connection with the acquisition, Liberty Global said it plans to buy back about $3.5 billion worth of its shares over a two-year period after the acquisition closes.
By Matt Kibbe
The short-term deal will assure long-term overspending
- Rand Paul: Budget deal 'shameful,' 'huge mistake'
- Teen thugs in D.C. run wild -- even while wearing GPS ankle bracelets
- KIBBE: Another Republican budget surrender
- Study IDs reasons for late-term abortions
- Obama takes 'selfie' at Mandela's funeral service
- Obama administration blasts GOP for criticism of Castro handshake
- CARSON: Why did the founders give us the Second Amendment?
- Obama's antics at Nelson Mandela tribute: Jovial conversation, handshake with Raul Castro
- Biden guarantees victory on immigration reform
- VEGAS RULES: Harry Reid pushed feds to change ruling for casino's big-money foreigners
Independent voices from the The Washington Times Communities
Interviews and show reviews from the Los Angeles punk scene past and present. Los Angeles has always been rich in punk rock talent since punk rock was born.
Buzz on Bees is a column promoting the love and life of God’s greatest pollinators on earth: The Honeybee
Brazen, leading-edge, “call it like it is” columns and reporting from Ohio native, radio host and writer, Sara Marie Brenner.
A libertarian look at breaking news and political trends by author Tom Mullen.
Extraordinary day at Redskins Park
White House pets gone wild!
Let it snow