Cable Forum - View Single Post - Virgin Media target for Private Equity Groups

Morden · 12-03-2008, 20:11

Well in Holland the main cable company there was bought over by privaye equity companies who grew the business for 4 to 5 years then sold off at major profits.

If a private equity company takes a similar long view here they can make virgin into a company that is a threat to SKY's profits.

I remember Branson saying in an interview recently that his prefered optiion for virgin would be private equity and that he may even increase his stake in the company should this happen.

He does a dim view of the city, buying back Virgin stores after its 1st share selloff as the shareholders wanted what was best for them not the company.

That is one advantage of private equity, not saying all private equitys run that way, especially if you are a highly profitable company already before they take you over. As then they then look at asset stripping, but in the case of virgin this is unlikely. I would guess that they are taking the long view for IP TV, streaming of high def movies and other emerging technologies as the only stable platform that can handle these effectively is a Fibre optic network, of which there is only one that reaches the majority of the UK.

But the network needs upgrading and expanding into new builds to reach its potential. Thats were inverstors may look for future profits, especially if they play the long game. e.g. buy cheap and sell for 5 times the buy value.

12-03-2008, 20:11	#6
Morden cf.addict Join Date: Mar 2007 Services: Cable, Freeview DVD recorder, telephone L, BB L, TV xl, V+ Posts: 130	Re: Virgin Media target for Private Equity Groups Well in Holland the main cable company there was bought over by privaye equity companies who grew the business for 4 to 5 years then sold off at major profits. If a private equity company takes a similar long view here they can make virgin into a company that is a threat to SKY's profits. I remember Branson saying in an interview recently that his prefered optiion for virgin would be private equity and that he may even increase his stake in the company should this happen. He does a dim view of the city, buying back Virgin stores after its 1st share selloff as the shareholders wanted what was best for them not the company. That is one advantage of private equity, not saying all private equitys run that way, especially if you are a highly profitable company already before they take you over. As then they then look at asset stripping, but in the case of virgin this is unlikely. I would guess that they are taking the long view for IP TV, streaming of high def movies and other emerging technologies as the only stable platform that can handle these effectively is a Fibre optic network, of which there is only one that reaches the majority of the UK. But the network needs upgrading and expanding into new builds to reach its potential. Thats were inverstors may look for future profits, especially if they play the long game. e.g. buy cheap and sell for 5 times the buy value.