NTL profits by €200m from sale of Irish business

THE sale of NTL’s Irish business delivered a profit on disposal of almost €200 million, the cable TV operator said yesterday.

The company sold its Irish subsidiary for €325m in May. It reported net income of stg£73.5m (€106m) for the three months to June, after a net loss of stg£250m (€360m) in the same period last year. It said the Irish deal, coupled with an improved operating performance, were the main reasons for better numbers.

It used proceeds of the sale to pay down over €300m in long-term debt, easing cashflow pressures by cutting ongoing interest costs. But as of the end of June it still has more than €2 billion outstanding.

NTL’s Irish business, which has 350,000 customers and includes cable TV, digital TV and broadband high-speed internet access activities in Dublin, Galway and Waterford, will become part of cable giant UGC when the deal receives clearance from the Competition Authority.

But NTL’s parent was able to pocket the money from the deal upfront, thanks to a structure that saw ownership of the business transferred to Irish Cable Holdings, a company affiliated to investment banking heavyweight Morgan Stanley.

The bank advised UGC during the bidding process and will sell on the business to UPC Ireland, a UGC subsidiary, when the transaction is cleared. UGC had provided the bank with the funds to pay for the business and facilitate the deal.

The sale will see NTL become part of the same group as Chorus, the Limerick-headquartered cable TV business formerly known as Irish Multichannel which provides TV services in Cork city.

The price obtained by NTL was at the higher end of expectations but less than half the €680m it paid to acquire the former Cablelink in 1999.