Virgin Media confirms auction delay

The UK cable company has confirmed widespread reports that its auction has had to be postponed, as the volatility in the credit markets claims its latest victim.

Virgin Media has confirmed that it is postponing its planned sale, in the hope that it will be able to attract higher bids once the current volatility in the debt market subsides.

In a statement, the UK cable company said its bankers had recommended it delay the auction, following a strategic review launched after an initial approach from buyout firm The Carlyle Group.

Virgin, which is being advised by Goldman Sachs and UBS, admitted that “potential strategic and financial counterparties have continued to confirm a strong ongoing interest in a transaction.” However, it said: “To enhance shareholder value, Virgin Media’s financial advisors have recommended that Virgin Media extend the process until these parties can complete their proposals in a more stable debt market environment”.

In addition to Carlyle, interested parties reportedly include The Blackstone Group, Cinven, Providence Equity Partners, Kohlberg Kravis Roberts and rival cable group Liberty. However, buyout firms have struggled to put together compelling bids, with banks unwilling to commit to new loans until they can work through their existing pipeline.

The company stressed that a sale was not inevitable. “There is no assurance that any transaction will occur or, if so, at what price,” the statement said.