Exhibit 99.2
NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, IN OR INTO CANADA,
AUSTRALIA OR JAPAN OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DO
SO.
4 April 2006
FOR IMMEDIATE RELEASE
RECOMMENDED OFFERS BY NTL FOR VIRGIN MOBILE
o NTL Incorporated ("NTL") and the Independent Board of Virgin Mobile
Holdings (UK) plc ("VIRGIN Mobile") are pleased to announce that
each of the pre-conditions set out in the pre-conditional possible
offer announcement made on 16 January 2006 has been satisfied or
waived and that they have reached agreement on the terms of a
recommended cash offer to be made by ntl Investment Holdings
Limited (the "CASH OFFEROR"), a wholly owned subsidiary of ntl,
with a recommended share alternative offer to be made by ntl, and a
recommended share and cash alternative offer to be made by ntl and
the Cash Offeror, to acquire the entire issued and to be issued
share capital of Virgin Mobile (the "OFFER"). The Offer will be
implemented by way of a scheme of arrangement under section 425 of
the Companies Act 1985, as amended.
o Pursuant to the terms of the Offer, Virgin Mobile Shareholders can
elect for:
(1) the Cash Offer of 372 pence in cash per Scheme Share held; or
(2) the Share Offer of 0.23245 ntl Shares per Scheme Share held,
valued at 389 pence per Scheme Share based on ntl's closing
price and the US$/(pound) exchange rate at 3 April 2006; or
(3) the Share and Cash Offer by ntl and the Cash Offeror of
0.18596 ntl Shares and 67 pence in cash per Scheme Share held,
valued at 311 pence per Scheme Share based on ntl's closing
price and the US$/(pound) exchange rate at 3 April 2006 plus
67 pence in cash.
o The above terms have been restated from those set out in ntl's
announcement of a potential offer for Virgin Mobile on 16 January
2006 as a result of the subsequent closing of the merger of ntl and
Telewest and the consequent change in the identity of the ultimate
parent company of the ntl Group. This has required the number of
ntl shares to be offered for each Virgin Mobile Share under the
Share Offer and the Share and Cash Offer to be adjusted as set out
in this announcement.
o The Cash Offer values the existing issued share capital of Virgin
Mobile at approximately (pound)962.4 million.
o The Cash Offer represents a premium of 19.6 per cent. to the Virgin
Mobile Share price on 2 December 2005, the last business day prior
to the commencement of the offer period; premia of 18.9 per cent.,
26.2 per cent. and 47.9 per cent. to the average Virgin Mobile
Share price over the one, three and twelve month periods prior to 5
December 2005, respectively; and a 86.0 per cent. premium to Virgin
Mobile's IPO offer price on 21 July 2004 when it was listed on the
London Stock Exchange.
o ntl has entered into a 30-year exclusive brand licence with Virgin
Enterprises Limited for the use of the Virgin brand for ntl's
consumer business.
o Closely following the merger of ntl and Telewest to create the UK's
leading triple-play cable provider, ntl's combination with Virgin
Mobile and the proposed re-branding of its combined consumer
businesses with the Virgin brand represents an important milestone
in ntl's history.
o ntl believes that the combination with Virgin Mobile and the
re-branding of its combined consumer operations with the Virgin
brand will deliver wide-ranging strategic and financial benefits to
shareholders. In particular, ntl believes that the transactions
will:
o help transform it from the UK's leading triple-play cable
provider into a national entertainment and communications
company, harnessing the powerful Virgin consumer champion
brand;
o enhance ntl as a scale competitor in the UK, enabling ntl to
compete more effectively with the large incumbents in the UK
telecommunications market. In addition, the extension of ntl's
product suite to include mobility will, ntl believes, provide
a strong platform for innovation and development of converged
products, such as converged fixed and mobile telephony
devices, and video and voice services;
o appeal to existing and new consumers by offering a wide range
of high quality communications services from a single
provider, with the unique flavour and customer focus of the
Virgin brand;
o allow it to extend its expertise in bundling and cross-selling
communications products to mobile telephony; and
o provide potential for revenue synergies by:
o increasing penetration and reducing customer churn by
providing an appealing product suite under the Virgin
brand; and
o increasing average revenue per user through the effective
cross-selling of mobile services into customer homes
serviced by ntl, and triple-play services to Virgin
Mobile subscribers.
o ntl believes that the Offer will not materially affect its current
leverage. Other potential benefits anticipated include savings on
some of the re-branding costs it may have incurred had it
re-branded under a newly created brand, and the use of certain
existing capital allowances to offset Virgin Mobile taxable income.
o Virgin Mobile will retain its existing brand and will continue to
be based in the UK.
o Virgin Mobile's operating business will continue to be led by
members of Virgin Mobile's current management team, and it is
intended that a marketing director from Virgin will join ntl,
bringing Virgin's brand expertise to the ntl management team.
o The Independent Board, who have been so advised by Morgan Stanley &
Co. Limited, consider the terms of the Cash Offer, the Share Offer
and the Share and Cash Offer to be fair and reasonable. In
providing advice to the Independent Board, Morgan Stanley & Co.
Limited has taken into account the commercial assessments of the
Independent Board.
o The Independent Board has indicated to ntl that it intends
unanimously to recommend that Virgin Mobile Shareholders vote in
favour of the Scheme at the appropriate meetings, as the
Independent Directors have undertaken to do in respect of all their
own beneficial holdings of 1,338,534 Virgin Mobile Shares,
representing as at the date of this announcement, in aggregate,
approximately 0.52 per cent. of the existing issued share capital
of Virgin Mobile.
o Virgin Mobile Shareholders considering making an election for the
Share Offer or for the Share and Cash Offer are referred to the
investment considerations which will be set out in the Scheme
Document. The decision as to whether Virgin Mobile Shareholders
make an election for the Share Offer or for the Share and Cash
Offer will depend on their individual circumstances. If Virgin
Mobile Shareholders are in any doubt as to the action they should
take, they should seek their own financial advice from an
independent financial adviser.
o ntl and the Cash Offeror have received irrevocable undertakings to
vote in favour of a scheme of arrangement to implement the Offer
from Virgin Mobile Shareholders representing approximately 72.0 per
cent. of the existing issued share capital of Virgin Mobile. The
Virgin Group which, taken together, holds approximately 71.2 per
cent. of the existing issued share capital of Virgin Mobile, has
undertaken, irrespective of whether any higher competing bid is
made, to vote in favour of a scheme of arrangement to implement the
Offer and to elect in full for the Cash and Share Offer.
Commenting on the Offer, James Mooney, Executive Chairman of ntl, said:
"We are delighted to announce the recommended Offer and the brand
licensing with Virgin today, which not only delivers mobile capability
to our product bundle but also gives us access to a leading consumer
brand. It truly is a step-change transaction not only for ntl but for
the media sector as an whole in the UK.
Central to today's announcement is our strong belief that offering a
quad-play underpins true media convergence, and offering high quality
communications services will, we believe, appeal to existing subscribers
of the enlarged business as well as new customers. There is a natural
appeal for mobile, telephony, broadband and television content and ntl
is now truly unique in its mass market product offering."
Commenting on the Offer, Charles Gurassa, Chairman of Virgin Mobile,
said:
"After careful consideration, the Independent Directors of Virgin Mobile
intend to recommend ntl's Offer to shareholders. This Offer reflects the
strong operational and financial performance of Virgin Mobile and
represents an excellent opportunity for Virgin Mobile shareholders to
realise the significant increase in shareholder value since flotation.
We believe this Offer is in the best interests of Virgin Mobile's
shareholders, customers and employees."
ENQUIRIES:
NTL
Richard Williams Tel: +44 (0)20 7299 5479
BUCHANAN COMMUNICATIONS (PR Adviser to ntl)
Mark Edwards or Jeremy Garcia Tel: +44 (0)20 7466 5000
GOLDMAN SACHS (Financial Adviser to ntl)
Alain Carrier Tel: +44 (0)20 7774 1000
VIRGIN MOBILE
Steven Day or Mike Thomas Tel: +44 (0)20 7484 4300
MORGAN STANLEY & CO. LIMITED (Financial Adviser to
Virgin Mobile)
Justin Manson or Scott Bruckner Tel: +44 (0)20 7425 8000
INVESTEC BANK (UK) LIMITED (Corporate Broker to
Virgin Mobile)
Chris Godsmark Tel: +44 (0)20 7597 5051
JP MORGAN CAZENOVE (Corporate Broker to
Virgin Mobile)
Arjun Khullar Tel: +44 (0)20 7155 8642
FINSBURY (PR Adviser to Virgin Mobile)
James Murgatroyd or Don Hunter Tel: +44 (0)20 7251 3801
A conference call and webcast for analysts and investors regarding the
Offer will be held today at 2 p.m. UK time/ 9 a.m. Eastern Standard Time
(UK: +44 20 7365 8426, US: +1 617 597 5341, participant code: ntl). The
presentation can also be accessed live via webcast on ntl's website,
www.ntl.com/investors. The teleconference replay will be available for
one week beginning approximately two hours after the end of the call and
will be available until Tuesday, 11 April 2006. The dial-in replay
number for the US is: +1 617 801 6888 and the international dial-in
replay number is: +44 (0) 207 365 8427, participant code: 98450630.
A press conference will be held today at 12 p.m. UK time at the offices
of Buchanan Communications, 45 Moorfields, EC2Y 9AE.
This summary should be read in conjunction with the full text of the
attached announcement. The Offer will be subject to the conditions set
out in Appendix I to this announcement and the full conditions and
further terms which will be set out in the Scheme Document expected to
be issued in due course.
Appendix II contains the sources and bases of information used in this
announcement.
Appendix III contains further details on the Implementation Agreement.
Appendix IV contains the definitions of certain expressions used in this
announcement.
Goldman Sachs International, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting
exclusively for ntl and the Cash Offeror and no one else in connection
with the Offer and will not be responsible to anyone other than ntl and
the Cash Offeror for providing the protections afforded to its customers
or for providing advice in relation to the Offer or any matter or
arrangement referred to herein.
Morgan Stanley & Co. Limited is acting exclusively for Virgin Mobile and
no one else in connection with the Offer and will not be responsible to
anyone other than Virgin Mobile for providing the protections afforded
to its clients or for providing advice in relation to the Offer or any
matter or arrangement referred to herein.
Investec Bank (UK) Limited is acting exclusively for Virgin Mobile and
no one else in connection with the Offer and will not be responsible to
anyone other than Virgin Mobile for providing the protections afforded
to its clients or for providing advice in relation to the Offer or any
matter or arrangement referred to herein.
JP Morgan Cazenove is acting exclusively for Virgin Mobile and no one
else in connection with the Offer and will not be responsible to anyone
other than Virgin Mobile for providing the protections afforded to its
clients or for providing advice in relation to the Offer or any matter
or arrangement referred to herein.
FURTHER INFORMATION ON THE OFFER
The availability of the Offer to Virgin Mobile Shareholders who are not
resident in the United Kingdom and the United States may be affected by
the laws of relevant jurisdictions. Virgin Mobile Shareholders who are
not resident in the United Kingdom or the United States will need to
inform themselves about and observe any applicable requirements.
Any securities that are offered pursuant to the Offer described in this
announcement have not been and will not be registered under the
applicable securities laws of Australia, Canada or Japan. Accordingly,
any such securities may not be offered, sold or delivered, directly or
indirectly, in or into Australia, Canada or Japan except pursuant to
exemptions from applicable requirements of such jurisdictions.
The Offer will be subject to the applicable rules and regulations of the
UKLA, the London Stock Exchange and the City Code. In addition, the
Offer will be subject to the applicable requirements of the United
States federal and state securities laws and the applicable rules and
regulations of NASDAQ (except to the extent exempt from such
requirements).
Virgin Mobile Shareholders should read any prospectus that may be filed
by ntl with the SEC, because any such prospectus will contain important
information. Investors may obtain a free copy of any prospectus, if and
when it becomes available, and other documents filed by ntl with the
SEC, at the SEC's website at http://www.sec.gov. Free copies of any
prospectus, if and when it becomes available, may be obtained by
directing a request to ntl Incorporated, 9098 Third Avenue, Suite 2863,
New York, New York 10022, Attention: Investor Relations. If the Offer
proceeds by way of scheme of arrangement, however, it is anticipated
that no prospectus would be required because the transaction would be
exempt from registration under the US Securities Act of 1933, as
amended, pursuant to section 3(a)(10) thereof, in which case this fact
will be disclosed in the scheme document sent to all Virgin Mobile
Shareholders.
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy securities, or the solicitation of any
vote or approval, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of such
jurisdiction.
CITY CODE
Under the provisions of Rule 8.3 of the City Code, if any person is, or
becomes, "interested" (directly or indirectly) in 1 per cent. or more of
any class of "relevant securities" of ntl, the Cash Offeror or of Virgin
Mobile, all "dealings" in any "relevant securities" of that company
(including by means of an option in respect of, or a derivative
referenced to, any such "relevant securities") must be publicly
disclosed by no later than 3.30 p.m. (London time) on the Business Day
following the date of the relevant transaction. This requirement will
continue until the date on which the Offer becomes, or is declared,
unconditional as to acceptances, lapses or is otherwise withdrawn or on
which the "offer period" otherwise ends. If two or more persons act
together pursuant to an agreement or understanding, whether formal or
informal, to acquire an "interest" in "relevant securities" of ntl, the
Cash Offeror or Virgin Mobile, they will be deemed to be a single person
for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the
City Code, all "dealings" in "relevant securities" of ntl, the Cash
Offeror or of Virgin Mobile by ntl, the Cash Offeror or Virgin Mobile,
or by any of their respective "associates", must be disclosed by no
later than 12.00 noon (London time) on the Business Day following the
date of the relevant transaction. A disclosure table, giving details of
the companies in whose "relevant securities" "dealings" should be
disclosed, and the number of such securities in issue, can be found on
the Panel's website at www.thetakeoverpanel.org.uk. "Interests in
securities" arise, in summary, when a person has long economic exposure,
whether conditional or absolute, to changes in price of securities. In
particular, a person will be treated as having an "interest" by virtue
of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities. Terms in quotation
marks are defined in the City Code, which can also be found on the
Panel's website. If you are in any doubt as to whether or not you are
required to disclose a "dealing" under Rule 8, you should consult the
Panel.
FORWARD LOOKING STATEMENTS
Certain statements in this document regarding the proposed transaction
between ntl and Virgin Mobile, the expected timetable for completing the
transaction, future financial and operating results, benefits and
synergies of the transaction, future opportunities for the combined
company and products and any other statements regarding Virgin Mobile's
or ntl's future expectations, beliefs, goals or prospects constitute
forward-looking statements as that term is defined in the U.S. Private
Securities Litigation Reform Act of 1995. When used in this document,
the words "believe", "anticipate", "should", "intend", "plan", "will",
"expects", "estimates", "projects", "positioned", "strategy", and
similar expressions or statements that are not historical facts, in each
case as they relate to ntl and Virgin Mobile, the management of either
such company or the proposed transaction, are intended to identify those
expressions or statements as forward-looking statements. In addition to
the risks and uncertainties noted in this document, there are certain
factors, risks and uncertainties that could cause actual results to
differ materially from those anticipated by some of the statements made,
many of which are beyond the control of ntl and Virgin Mobile. These
include: (1) the failure to obtain and retain expected synergies from
the integration of legacy ntl and legacy Telewest Global and the
proposed transaction, (2) rates of success in executing, managing and
integrating key acquisitions, including the integration of legacy ntl
and legacy Telewest Global and the proposed acquisition, (3) the ability
to achieve business plans for the combined company, (4) the ability to
manage and maintain key customer relationships, (5) delays in obtaining,
or adverse conditions contained in, any regulatory or third-party
approvals in connection with the proposed acquisition, (6) availability
and cost of capital, (7) the ability to manage regulatory, tax and legal
matters, and to resolve pending matters within current estimates, (8)
other similar factors, and (9) the risk factors summarized and explained
in the 2005 Form 10-K for NTL Holdings Inc. (fka NTL Incorporated). For
additional information concerning factors that could cause actual
results to materially differ from those projected herein, please refer
to ntl's and NTL Holdings Inc.'s most recent Form 10-K, 10-Q and 8-K
reports.
NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION IN OR INTO AUSTRALIA,
CANADA OR JAPAN OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO DO SO.
4 April 2006
RECOMMENDED OFFERS BY NTL FOR VIRGIN MOBILE
1. INTRODUCTION
NTL Incorporated ("NTL") and the Independent Board of Virgin Mobile
Holdings (UK) plc ("VIRGIN MOBILE") are pleased to announce that
each of the pre-conditions set out in the pre-conditional possible
offer announcement made on 16 January 2006 has been satisfied or
waived and that they have reached agreement on the terms of a
recommended cash offer to be made by ntl Investment Holdings
Limited (the "CASH OFFEROR"), a wholly owned subsidiary of ntl,
with a recommended share alternative offer to be made by ntl, and a
recommended share and cash alternative offer to be made by ntl and
the Cash Offeror, to acquire the entire issued and to be issued
share capital of Virgin Mobile. The Offer will be implemented by
way of a scheme of arrangement under section 425 of the Companies
Act 1985, as amended.
2. OUTLINE TERMS AND CONDITIONS OF THE OFFER
Under the Offer, which is subject to the conditions referred to in
paragraph 11 and set out in Appendix I to this announcement, and
subject to the further terms and conditions to be set out in the
Scheme Document, Scheme Shareholders will be able to elect to
accept the following alternative offers:
(a) Under the Cash Offer:
FOR EACH SCHEME SHARE HELD 372P IN CASH
(b) Under the Share Offer:
FOR EACH SCHEME SHARE HELD 0.23245 NTL SHARES
(c) Under the Share and Cash Offer:
FOR EACH SCHEME SHARE HELD 0.18596 NTL SHARES PLUS 67P IN CASH
The above terms have been restated from those set out in ntl's
announcement of a potential offer for Virgin Mobile on 16 January
2006 as a result of the subsequent closing of the merger of ntl and
Telewest and the consequent change in the identity of the ultimate
parent company of the ntl Group. This has required the number of
ntl shares to be offered for each Virgin Mobile Share under the
Share Offer and the Share and Cash Offer to be adjusted as set out
in this announcement.
3. THE CASH OFFER
The Cash Offer represents a premium of 19.6 per cent. to the Virgin
Mobile Share price on 2 December 2005, the last business day prior
to the commencement of the offer period; premia of 18.9 per cent.,
26.2 per cent. and 47.9 per cent. to the average Virgin Mobile
Share price over the one, three and twelve month periods prior to 5
December 2005, respectively; and a 86.0 per cent. premium to Virgin
Mobile's IPO offer price on 21 July 2004 when it was listed on the
London Stock Exchange.
The Cash Offer values the entire issued share capital of Virgin
Mobile at approximately (pound)962.4 million.
4. THE SHARE OFFER
As an alternative offer to the Cash Offer, Scheme Shareholders
(other than certain Overseas Shareholders) may elect to receive ntl
Shares to be offered by ntl, on the basis of 0.23245 ntl Shares for
each Scheme Share held.
ntl Shares are quoted and tradable on the NASDAQ National Market.
Applications will be made for the new ntl Shares to be quoted on
the NASDAQ National Market.
The Share Offer is valued at 389 pence per Scheme Share based on
ntl's closing price and the US$/(pound) exchange rate at 3 April
2006.
5. THE SHARE AND CASH OFFER
As an alternative to both the Cash Offer and the Share Offer, ntl
and the Cash Offeror are also making the Share and Cash Offer,
which will enable Scheme Shareholders (other than certain Overseas
Shareholders) to elect to receive ntl Shares and cash, to be
offered by ntl and the Cash Offeror on the basis of 0.18596 ntl
Shares and 67 pence in cash for each Scheme Share held.
ntl Shares are quoted and tradable on the NASDAQ National Market.
Applications will be made for the new ntl Shares to be quoted on
the NASDAQ National Market.
The Share and Cash Offer is valued at 311 pence per Scheme Share
based on ntl's closing price and the US$/(pound) exchange rate at 3
April 2006 plus 67 pence in cash.
6. IRREVOCABLE UNDERTAKINGS TO ACCEPT THE OFFER
In aggregate, ntl and the Cash Offeror have received irrevocable
undertakings to vote in favour of the Scheme (or accept the Offer,
if it is restructured as a Takeover Offer) from Virgin Mobile
Shareholders representing approximately 72.0 per cent. of the
existing issued capital of Virgin Mobile.
The Virgin Group which, taken together, holds Virgin Mobile Shares
representing approximately 71.2 per cent. of the existing issued
ordinary share capital of Virgin Mobile, has irrevocably
undertaken, irrespective of whether any higher competing bid is
made, to vote its holding in favour of the Scheme or to accept a
Takeover Offer (in the event of the Offer being restructured as a
Takeover Offer). In the event that the Offer is restructured as a
Takeover Offer, ntl has agreed with Virgin that such Takeover Offer
will be on identical terms save always that such Takeover Offer
will be conditional on receiving at least 70 per cent. acceptances.
Virgin has elected to accept the Share and Cash Offer in respect of
all its Scheme Shares.
The irrevocable undertakings received from the Independent Board
are in respect of their (and their connected persons') respective
entire holdings of Virgin Mobile Shares, amounting in aggregate to
1,338,534 Virgin Mobile Shares, representing approximately 0.52 per
cent. of Virgin Mobile's existing issued ordinary share capital.
7. BRAND LICENCE
ntl and Virgin Enterprises have also entered into a trade mark
licence agreement (the "BRAND LICENCE"), licensing to ntl the use
of certain Virgin trade marks within the United Kingdom and
Ireland. The Brand Licence is an exclusive licence, covering a
number of aspects of ntl's consumer business, including the
provision of communications services (such as internet, television,
and fixed line telephony), the acquisition and branding of sports,
movie and other premium television content, the acquisition and
exploitation of sports media rights, and the branding and sale of
related communications equipment (such as set-top boxes and cable
modems). If ntl acquires Virgin Mobile, the Brand Licence will also
replace the existing brand licensing arrangements between Virgin
Mobile and Virgin. The Brand Licence also permits ntl to rename its
ultimate public holding company with a name that includes the
Virgin name. The Brand Licence is for a 30 year period, although
ntl may terminate it at the end of the tenth year of that period on
one year's notice. The Brand Licence is subject to early
termination by ntl in certain circumstances, including (subject to
the making of certain payments) on a change of control of ntl.
Under the Brand Licence, ntl will pay Virgin Enterprises a royalty
of 0.25 per cent. of relevant consumer revenues (which would have
been approximately (pound)9 million based on 2005 revenues
(including Virgin.net and Virgin Mobile)), which royalty is subject
to a minimum annual payment of (pound)8.5 million. ntl expects to
commence the proposed re-branding within 12 months of the Brand
Licence becoming unconditional.
In connection with the Brand Licence, Virgin Enterprises will have
the right to propose a nominee to serve as a director of ntl, and
will also have the right to nominate a senior marketing executive
(reporting to the Chief Executive Officer, Chief Operating Officer,
or senior person in charge of ntl's consumer division) as a ntl
employee. In addition, Sir Richard Branson has also agreed to
support ntl's promotional activities.
The Brand Licence is conditional upon the passing of an ordinary
resolution of the Independent Virgin Mobile Shareholders (which
requires a vote, to be held on a poll, in favour, of more than 50
per cent. of the votes cast by Independent Virgin Mobile
Shareholders) to approve the Brand Licence. The Independent Board
intends unanimously to recommend that the Independent Virgin Mobile
Shareholders vote in favour of the resolution to approve the Brand
Licence.
The terms of the Brand Licence are considered by Morgan Stanley,
Virgin Mobile's financial adviser, to represent an arm's length
commercially negotiated agreement and therefore are considered to
be fair and reasonable. In forming this view, Morgan Stanley has
taken into account the commercial assessments of the Independent
Board.
Further details of the Brand Licence will be set out in the Scheme
Document.
8. BACKGROUND TO AND REASONS FOR THE OFFER
Closely following the merger of ntl and Telewest to create the UK's
leading triple-play cable provider, ntl's combination with Virgin
Mobile together with the proposed re-branding of its combined
consumer business with the Virgin brand represents an important
milestone in ntl's history. ntl believes that the combination and
re-branding will deliver wide-ranging strategic and financial
benefits to its shareholders. It enhances ntl as a scale competitor
in the UK telecommunications industry, enabling it to become the
first market participant offering an integrated quad-play product
suite, combining ntl's network, products and triple-play experience
together with Virgin Mobile's national mobile business, creating a
national communications and entertainment company.
Furthermore, the re-branding of ntl's consumer business with the
Virgin brand will bring Virgin's strong brand into more than 5.1
million UK homes and, ntl believes, will provide strong consumer
appeal for a wide range of high quality communications services
available from a single provider under a single consumer champion
brand.
Strengthening of ntl's competitiveness
The competitive landscape in European and UK telecommunications has
recently been undergoing substantial change, with the recent
consolidation of various market participants and the convergence of
telecommunications platforms and technologies. The recent merger of
ntl and Telewest provides ntl with competitive scale and an access
network passing more than half of UK homes, plus a strong platform
on which to base brand and product extension. ntl believes that the
mobile product of Virgin Mobile and the Virgin brand would enable
ntl to extend its portfolio to compete more effectively with the
large incumbents.
Following the merger between ntl and Telewest, ntl is the largest
provider of consumer broadband, the second largest provider of
fixed telephony, the second largest provider of pay TV and the
third largest provider of multi-channel TV, and, after the
acquisition of Virgin Mobile, would be the fifth largest provider
of mobile telephony (in each case, by number of subscribers).
Furthermore, the extension of ntl's product suite to include
mobility will, ntl believes, provide a strong platform for the
innovation and development of converged products, such as converged
fixed and mobile telephony devices, and video and voice services.
Brand with strong consumer appeal
ntl believes that the Virgin brand would bring it a strong consumer
appeal, positioning and customer focus to a quad-play offering. It
would allow ntl to utilise Virgin's brand expertise and consumer
focus and should help increase customer loyalty and appeal.
The Virgin brand is the most admired brand in the UK (HPI Research
2005) and Virgin is the 27th most respected company in the world
(FT 2005) (in each case, as at the time of the relevant surveys).
First quad-play in the UK provides growth prospects
ntl believes that, following a combination with Virgin Mobile, it
will be able to extend its expertise in bundling and cross-selling
communications products to mobile telephony. It would create the
UK's first communications quad-play proposition. ntl's customer
base of over 5.1 million cable homes would be enhanced by Virgin
Mobile's more than 4.3 million active mobile subscribers. In
aggregate, the combined ntl and Virgin Mobile group would have 14.6
million RGUs (based on ntl and Telewest RGUs and Virgin Mobile
active subscribers as reported as at 31 December 2005). The
bundling of four communications products into one integrated
offering to ntl's and Virgin Mobile's customers should create a
strong competitive proposition, enabling ntl to deliver greater
value for money to customers.
Significant value creation opportunities
ntl believes that a combination with Virgin Mobile would create the
potential for revenue synergies by:
o increasing penetration and reducing customer churn by
providing an appealing product suite under the Virgin brand;
and
o increasing ARPU through the effective cross-selling of mobile
services into customer homes serviced by ntl, and triple-play
services to Virgin Mobile subscribers.
Financial impact on ntl
As referred to above, ntl expects to generate certain revenue
synergies over the medium-term.
Other potential benefits anticipated include the savings that ntl
believes would be derived from the re-branding of all of ntl's
consumer operations with the Virgin brand. Pursuant to the Brand
Licence, ntl would have the ability to access one of the most
powerful and customer-friendly brands in the UK, without some of
the re-branding costs it may have incurred had it re-branded with a
new brand. ntl also expects to benefit from Virgin Mobile's high
street presence (which includes over 100 "stores within stores" in
Virgin Megastores and WH Smith stores, through which it intends to
sell other ntl products).
In addition, ntl plans to consolidate Virgin Mobile into its group
for UK corporation tax purposes, enabling it to use certain
existing capital allowances to offset Virgin Mobile taxable income.
Combination with Virgin Mobile
The ongoing process of integrating ntl's legacy business with the
business of Telewest was designed to enable ntl also to absorb
Virgin Mobile, were it be to acquired. In the immediate future, ntl
does not intend fully to integrate Virgin Mobile into ntl's
operations. ntl management's priority would continue to be the
integration of ntl's legacy cable businesses operations with those
of Telewest, and the exploitation of the benefits of the merger of
ntl and Telewest. It is intended that Virgin Mobile management
would report to the Chief Operating Officer of ntl.
T-Mobile
T-Mobile, Virgin Mobile's network provider, has indicated that it
is supportive of the Offer.
9. BACKGROUND AND REASONS FOR THE RECOMMENDATION OF THE OFFER
Virgin Mobile listed on the London Stock Exchange on 21 July 2004,
four and a half years after launching its customer offer. At the
time of the IPO, Virgin Mobile laid out its plan to grow the
business. Since listing, Virgin Mobile has delivered against this
strategy, producing sector leading revenue growth by: leveraging
the Virgin Mobile brand; maintaining a differentiated approach to
market through innovation; and having the most satisfied customers
in the sector. Virgin Mobile's robust operational and financial
results have been reflected in the strong share price performance
since IPO.
On 5 December 2005 the Virgin Mobile Board confirmed that it had
received an approach from ntl regarding a possible offer for Virgin
Mobile. The Virgin Group representative on the Virgin Mobile Board
absented himself from the Virgin Mobile Board, and further
deliberations continued among the Independent Board members. After
careful consideration, the Independent Board determined that ntl's
potential cash offer of 323p materially undervalued Virgin Mobile
and unanimously rejected this proposal.
In early January 2006 ntl re-approached the Independent Board.
After detailed negotiations, the terms of a revised potential offer
were finalised. In a joint announcement on 16 January 2006, Virgin
Mobile and ntl notified the market of discussions in respect of a
potential cash offer of 372p, with share alternative offers. These
discussions have resulted in a firm intention to make the Offer now
being announced.
The Independent Board believes that the revised Offer from ntl
fairly reflects the value of Virgin Mobile and the future potential
of the business, and accordingly the Independent Board intends
unanimously to recommend this Offer.
10. FINANCING THE OFFER
The transaction will be financed by a combination of cash and ntl
Shares. If all Independent Virgin Mobile Shareholders accept the
Cash Offer, ntl will require approximately (pound)290.5 million to
satisfy acceptances of the Cash Offer (assuming that all holders of
options under the Virgin Mobile Share Option Schemes receive cash
consideration), and approximately (pound)123.4 million to satisfy
full acceptance of the cash element of the Share and Cash Offer by
Virgin Group in respect of its approximately 71.2 per cent.
shareholding of the current issued share capital of Virgin Mobile.
This would result in a total cash consideration of approximately
(pound)414.0 million. To satisfy acceptance of the share element of
the Share and Cash Offer by Virgin, ntl will also issue
approximately 34.3 million ntl Shares to the Virgin Group. As a
result, on a successful completion of the Offer, Virgin Group will
own approximately 10.1 to 10.6 per cent. of then current issued
share capital of ntl, depending on the elections made by
Independent Virgin Mobile Shareholders.
ntl will also refinance the existing Virgin Mobile indebtedness,
which was approximately (pound)192.7 million as at 30 September
2005.
ntl believes that the Offer will not materially affect its current
leverage. The cash consideration will be financed by a combination
of existing cash and incremental (pound)475 million financing
commitments from the existing ntl banking syndicate (comprised of
an additional (pound)175 million of borrowings under the 5-year
amortizing term loan facility entered into in connection with the
acquisition of Telewest, and a (pound)300 million 6 1/2-year bullet
repayment facility).
Following completion on 3 March 2006 of the merger of ntl and
Telewest, on 3 March 2006 Standard & Poors confirmed its previously
stated credit rating for ntl, being a B+ corporate credit rating
with positive outlook. Standard & Poors also stated on that date
that this confirmation also encompasses its assessment of the
anticipated acquisition of Virgin Mobile by ntl, which it
considered to be neutral for the combined company's credit profile
in the short term.
On 27 March 2006 Moody's upgraded ntl's corporate family rating
from B1 to Ba3 with stable outlook. Moody's stated that, whilst it
expected the integration of ntl and Telewest to pose significant
organisational challenges, it recognised the potential benefits
that could result from an acquisition of Virgin Mobile, in terms of
increased customer reach and increased product offering, as well as
the use of the Virgin brand.
11. STRUCTURE OF THE PROPOSALS
Introduction
The Scheme involves applications by Virgin Mobile to the Court to
sanction the Scheme and then to confirm the cancellation of the
Scheme Shares, in consideration for which Scheme Shareholders on
the register of members at the Scheme Record Time will receive
cash, ntl Shares or ntl Shares and cash, depending on their
elections on the basis set out in paragraphs 2 to 5 above. The
cancellation and the subsequent issue of new Virgin Mobile shares
to members of the ntl Group provided for in the Scheme will result
in Virgin Mobile becoming a wholly-owned subsidiary company in the
ntl Group.
The Meetings
Before the Court's approval can be sought, the Scheme of
Arrangement will require approval by Scheme Shareholders at a Court
Meeting and the passing of a special resolution by Virgin Mobile
Shareholders to implement the Scheme at an Extraordinary General
Meeting. In addition, the Scheme is conditional upon the approval
of the Brand Licence by a majority of the Independent Virgin Mobile
Shareholders who vote for the purposes Rule 16 of the City Code.
The Court Meeting will be held at the direction of the Court to
seek the approval of the Scheme Shareholders to the Scheme. The
approval required at the Court Meeting is a majority in number of
the Scheme Shareholders who vote, representing three fourths or
more in value of the votes cast, either in person or by proxy, at
the Court Meeting.
In addition, an Extraordinary General Meeting will be held for the
purpose of considering and, if thought fit, passing a special
resolution (which requires a vote in favour of not less than 75 per
cent. of the votes cast) to approve:
(i) the Scheme;
(ii) the reduction of capital and the issue of new Virgin Mobile
Shares to members of the ntl Group provided for in the
Scheme; and
(iii) amendments to the articles of association of Virgin Mobile
(such changes to be conditional on the Scheme becoming
effective) in accordance with the Scheme and as described
below.
The Extraordinary General Meeting will also consider, and if
thought fit, pass an ordinary resolution of the Independent Virgin
Mobile Shareholders (which requires a vote, to be held on a poll,
in favour, of more than 50 per cent. of the votes cast by
Independent Virgin Mobile Shareholders) to approve the Brand
Licence.
Conditions to the Offer
The Conditions to the Offer are set out in Appendix I to this
document. As currently structured, the Offer is conditional, inter
alia, upon:
o the Scheme becoming effective by not later than 15 August 2006
or such later date as Virgin Mobile, ntl and the Cash Offeror
may agree in writing (and, if appropriate, the Court may
approve) failing which the Scheme will lapse;
o the approval by a majority in number representing three
fourths or more in value of the holders of Scheme Shares,
present and voting, either in person or by proxy, at the Court
Meeting;
o the passing of the special (and any other) resolution required
to implement the Scheme as set out in the notice of
Extraordinary General Meeting at the Extraordinary General
Meeting;
o the passing of the ordinary resolution by the Independent
Virgin Mobile Shareholders to approve the Brand Licence.
Approval of the Brand Licence is required by the Panel and the
resolution will be passed if a simple majority of the
Independent Virgin Mobile Shareholders voting, in person or by
proxy, on a poll, vote in favour of it;
o the sanction of the Scheme (without modification or with
modification(s) agreed by Virgin Mobile and ntl) and the
subsequent confirmation of the reduction of capital involved
therein, in each case, by the Court and an office copy of the
Court order and the minute of such reduction attached thereto
being delivered for registration to the Registrar of Companies
of England and Wales and, in relation to the reduction of
capital, being registered by him; and
o the Conditions which are not otherwise identified above being
satisfied or waived.
Once the necessary approvals from Virgin Mobile Shareholders have
been obtained and the other Conditions have been satisfied or
(where applicable) waived, the Scheme and associated reduction of
capital will become effective following sanction by the Court upon
delivery to and, in the case of the associated reduction of
capital, registration of the Court Order by the Registrar of
Companies in England and Wales.
Once effective, the Scheme will be binding on all Scheme
Shareholders, including those who did not vote, or who voted
against it, at the Meetings or who could not be traced.
It is also proposed that, following the Effective Date, Virgin
Mobile's listing on the Official List will be cancelled and Virgin
Mobile will be re-registered as a private company under the
relevant provisions of the Companies Act.
12. ANTICIPATED TIMETABLE
Virgin Mobile anticipates that it will post the Scheme Document
within the next 28 days; that the Court Meeting and Extraordinary
General Meeting will take place during May 2006; and that, subject
to the Scheme becoming unconditional and effective, the Effective
Date will occur in late June 2006.
13. MANAGEMENT AND EMPLOYEES
ntl confirms that it intends to safeguard the existing contractual
and statutory employment rights, including pension rights, of the
existing employees of the Virgin Mobile Group.
14. VIRGIN MOBILE SHARE OPTION SCHEMES
At the same time as, or as soon as practicable following, the
publication of the Scheme Document, explanatory letters will be
sent to the participants in the Virgin Mobile Share Option Schemes
explaining the effect of the Scheme on them and, where applicable,
their right to exercise share options or to receive shares under
awards.
It is proposed to amend the articles of association of Virgin
Mobile at the Extraordinary General Meeting to provide that, if the
Scheme becomes effective, any Virgin Mobile Share issued after the
Hearing Date will automatically (and immediately following issue)
be transferred to a member of the ntl Group in exchange for the
Offer Price in cash on the same basis as under the Scheme.
Consequently, participants in the Virgin Mobile Share Option
Schemes who exercise any options or receive shares under awards
after the Scheme becomes effective will receive cash consideration
in the same manner as Scheme Shareholders who elect for the Cash
Offer under the Scheme.
Further details of these proposals will be set out in the letters
to the participants in the Virgin Mobile Share Option Schemes.
15. INFORMATION ON NTL
ntl is the UK's second largest communications company and leading
triple play service provider with a cable footprint covering more
than 50 per cent. of UK households. Following its merger with
Telewest, ntl has more than 5.1 million residential customers and
is the largest provider of residential broadband services in the UK
with 2.8 million subscribers, the second largest pay TV provider
(and the third largest provider of multi-channel TV) with 3.3
million subscribers and also the second largest fixed telephony
provider with 4.3 million subscribers.
ntl's services are delivered through its wholly-owned local access
communications network passing approximately 12.4 million homes in
the UK. The design and capability of its network provides ntl with
the ability to offer triple-play bundled services and a broad
portfolio of reliable, competitive communications solutions to
business customers.
ntl provides services to two categories of customers (residential
customers and business customers) as follows:
o Consumer: internet, telephone and cable television services to
residential customers in the UK; and
o Business: internet, data and voice services to large
businesses, public sector organisations and small and
medium-sized enterprises, or SMEs, communications transport
services, and wholesale internet access solutions to internet
service providers, or ISPs.
ntl's combined legacy ntl and Telewest local access networks, which
do not overlap, provide a strong platform allowing for product
differentiation and innovation and the delivery of unique packages
of service offerings. ntl now has the benefit of a much larger
cable network (following its merger with Telewest) and, together
with Telewest's content division, a strong position in the
multi-channel TV marketplace.
16. INFORMATION ON VIRGIN MOBILE
Virgin Mobile is the UK's largest mobile virtual network operator
("MVNO") with more than 4.3 million customers. Virgin Mobile
launched its operations in November 1999 and provides a broad range
of mobile communications services to its customers.
At launch, Virgin Mobile's addressable market encompassed all of
the pre-pay market and in May 2005 it expanded to include the
consumer contract market with the launch of Virgin Mobile Pay
Monthly. In a short space of time, Virgin Mobile has built up a
distribution network of over 16,000 outlets connecting customers
and over 100,000 outlets selling airtime. It utilises the value of
the Virgin brand by putting dedicated Virgin Mobile "stores within
stores" inside over 100 Virgin Megastores and WH Smith stores
nationally.
Virgin Mobile's successful business philosophy is centred around
five key strengths: a strong brand; a low capital investment
business model; a differentiated approach to the market; an
award-winning customer service; and a strong management team.
Virgin Mobile benefits from the strength of the Virgin brand that
has assisted the growth and level of Virgin Mobile's brand
recognition within the UK. The Virgin Mobile brand is reflected in
the company's entrepreneurial culture, customer proposition and
differentiated approach to the market. Virgin Mobile believes it
has good value tariffs which are easy to understand and a wide
range of the latest handsets, and that it rewards customer loyalty.
As an MVNO, Virgin Mobile has modest capital investment
requirements when compared to its peers, which results in
exceptional returns on capital. Capital investments are primarily
made to support growth, operational efficiencies and the customer
proposition. Virgin Mobile currently operates under its
non-exclusive, minimum ten year term Telecommunications Supply
Agreement with T-Mobile, signed in January 2004, and has recently
entered into an agreement with BT Movio, a division of BT plc, to
offer mobile TV to customers using the UK's Digital One DAB
broadcast network.
Virgin Mobile differentiates its approach to the market by
challenging market convention, being customer focused and offering
a simple and compelling customer proposition. Its products and
brand are backed up by the best customer service in the industry.
It has won numerous awards for its dedication to customer care, is
consistently highly rated in customer satisfaction surveys and has
rates of customer churn below the industry average.
Since launch in 1999, Virgin Mobile has been led by strong
management, consisting of highly experienced individuals with
proven track record. This team was instrumental in developing and
implementing a customer-oriented business, which has delivered
rapid growth and strong financial results.
Virgin Mobile's interim unaudited results for the period to 30
September 2005 (prepared in accordance with IFRS) were announced on
17 November 2005. These showed a turnover for the period of
(pound)274.6 million (2004: (pound)256.7 million), service revenues
of (pound)250.8 million (2004: (pound)230.7 million), operating
profit of (pound)45.5 million (2004: (pound)35.7 million), EBITDA
(excluding one-off items) of (pound)54.0 million (2004: (pound)55.6
million), and basic EPS of 10.8 pence (2004: 7.8 pence). Net debt
as at 30 September 2005 was (pound)192.7 million (2004:
(pound)264.1 million). Under Virgin Mobile's current accounting
policies, subscriber acquisition costs ("SACS") for contract
customers are recognized over the length of the contract. If
contract SACs had been expensed in full upon connection, ntl
estimates that operating profit and EBITDA for the period to 30
September 2005 would have been reduced by approximately (pound)16
million.
For the 12 month period to 30 September 2005, Virgin Mobile's
turnover was (pound)539 million, EBITDA excluding one-off items (a
Virgin Mobile non-GAAP financial measure derived from financial
statements prepared in IFRS) was (pound)99 million, and purchase of
fixed assets (pound)11 million (in each case, for the last twelve
months to 30 September 2005, calculated by subtracting the reported
results for the six months to 30 September 2004 from the reported
results for the year to 31 March 2005 and adding the reported
results for the six months to 30 September 2005).
Virgin Mobile's key performance indicators for the three months to
31 December 2005 were announced on 1 February 2006. These showed Q3
service revenues up 20.3% year on year (H1 FY06: 8.7%, excluding
Ofcom termination rate cut - H1FY06: 17.9%), total active customers
increased 12% to 4,346,000 (Q3 FY 05: 3,879,000), rising 12 month
rolling ARPU of (pound)123 (H1 FY06: (pound)121) and strong
customer growth with 193,000 net active additions (Q3 FY05:
276,000).
17. INTERESTS IN VIRGIN MOBILE SHARES
Save for the irrevocable undertakings referred to in paragraph 6
above, neither the Cash Offeror nor ntl nor any of their directors
nor, so far as the directors of the Cash Offeror or ntl are aware,
any person acting in concert with the Cash Offeror or ntl for the
purposes of the Offer, owns or controls or holds any option to
purchase, or has any arrangement in relation to Virgin Mobile
Shares or securities convertible or exchangeable into Virgin Mobile
Shares or options (including traded options) in respect of, or has
entered into any derivative referenced to, any such shares. For
these purposes, "arrangement" includes any indemnity or option
arrangement, any agreement or understanding, formal or informal, of
whatever nature, relating to Virgin Mobile Shares which may be an
inducement to deal or refrain from dealing in such shares.
18. INDUCEMENT FEE
In the Implementation Agreement, Virgin Mobile has agreed with the
Cash Offeror and ntl that it will not enter into any inducement fee
arrangements with any person in connection with an approach to
Virgin Mobile or a proposal or offer to acquire shares in the
capital of Virgin Mobile. No inducement fee arrangement has been
agreed with the Cash Offeror or ntl.
19. IMPLEMENTATION AGREEMENT
ntl, the Cash Offeror, and Virgin Mobile have entered into an
implementation agreement regarding the implementation of the Scheme
(or, if applicable, a Takeover Offer) and the conduct of the
business of Virgin Mobile in the period up to the Effective Date
(or, if applicable, the date on which the Offer becomes or is
declared unconditional in all respects).
ntl can terminate the Implementation Agreement if Virgin Mobile
breaches certain covenants contained in the Implementation
Agreement. Further details of the Implementation Agreement are set
out in Appendix III.
20. INVESTMENT AGREEMENT
In connection with the possible issue of ntl Shares to members of
the Virgin Group pursuant to the Offer, a member of the Virgin
Group and Sir Richard Branson have entered into an investment
agreement dated 3 April 2006, that will become effective on the
Effective Date.
The Investment Agreement places restrictions on the extent to which
the relevant Virgin Group holders of ntl Shares will be able to
dispose of those ntl Shares during an 18 month period from the
Effective Date, with those restrictions relaxing on the following
basis during that period (cumulatively, but including any prior
sales by them of ntl Shares):
(i) 12.5 per cent. of their initial holding after three months;
(ii) 25 per cent. of their initial holding after six months;
(iii) 37.5 per cent. of their initial holding after nine months;
(iv) 50 per cent. of their initial holding after twelve months;
(v) 75 per cent. of their initial holding after fifteen months;
(vi) 100 per cent. of their initial holding after eighteen months
(i.e. at this point their ntl Shares become freely
transferable).
In addition, it places certain restrictions on the conduct of those
holders, and Sir Richard Branson, such that those holders:
(i) would not be permitted to acquire more than 15 per cent., in
aggregate, of ntl's Shares (subject to certain exceptions and
ntl's shareholder rights plan);
(ii) would not be permitted to sell any ntl Shares to any person
or persons who would own, in aggregate, 1 per cent. of ntl's
entire issued share capital following any such sale or sales;
(iii) agree that they would exercise their voting rights pro rata
with the votes of other holders of ntl Shares, or in support
of any actions recommended by the board of directors of ntl
in respect of: any amendment of ntl's articles or bylaws; any
proposal that could facilitate a change of control of ntl; or
on any election of a director of ntl. Notwithstanding that,
those holders retain the right to vote against a business
combination transaction recommended by the board of ntl, and
to refuse to accept a recommended offer for their ntl Shares;
and
(iv) are restricted from: offering, proposing or seeking to enter
into business combination transactions; participating in the
solicitation of proxies; proposing shareholder proposals;
publicly opposing recommendations by the board of directors
of ntl; and engaging in related discussions with third
parties, making related public announcements, or assisting
other persons to do the same,
which restrictions all expire after ntl's 2008 annual stockholders'
meeting has taken place.
Furthermore, it contains registration rights under the US
Securities Exchange Act of 1933, as amended, in favour of the above
persons in respect of their holdings of ntl Shares.
The Investment Agreement is subject to early termination by ntl in
certain circumstances, including (subject to the making of certain
payments) on a change of control of ntl.
Further details of the Investment Agreement will be set out in the
Scheme Document.
21. OVERSEAS SHAREHOLDERS
The availability of the Offer to persons not resident in the United
Kingdom and the United States may be prohibited or affected by the
laws of the relevant jurisdictions. Such persons should inform
themselves about, and observe, any applicable requirements.
22. RECOMMENDATION
The Independent Board, who have been so advised by Morgan Stanley,
consider the terms of the Cash Offer, the Share Offer, and the
Share and Cash Offer, to be fair and reasonable. In providing
advice to the Independent Board, Morgan Stanley has taken into
account the commercial assessments of the Independent Board.
The Independent Board has indicated to ntl that it intends
unanimously to recommend that the Virgin Mobile Shareholders vote
in favour of the Scheme at the appropriate meetings, as the
Independent Directors have undertaken to do in respect of all their
own beneficial holdings of 1,338,534 Virgin Mobile Shares,
representing as at the date of this announcement, in aggregate,
approximately 0.52 per cent of the existing issued share capital of
Virgin Mobile.
Virgin Mobile Shareholders considering making an election for the
Share Offer or for the Share and Cash Offer are referred to the
investment considerations which will be set out in the Scheme
Document. The decision as to whether Virgin Mobile Shareholders
make an election for the Share Offer or for the Share and Cash
Offer will depend on their individual circumstances. If Virgin
Mobile Shareholders are in any doubt as to the action they should
take, they should seek their own financial advice from an
independent financial adviser.
The Independent Board considers that the terms of the Brand Licence
represent an arm's length commercially negotiated agreement and
therefore are fair and reasonable.
Accordingly, the Independent Board has indicated to ntl that it
intends unanimously to recommend that the Independent Virgin
Shareholders vote in favour of the resolution to approve the Brand
Licence as they intend to do in respect of their own Virgin Mobile
Shares.
23. GENERAL
The acquisition of Virgin Mobile may be made by one or more new
companies in addition to ntl, or in substitution for the Cash
Offeror at ntl's sole discretion. Details of any such companies
will be included in the Scheme Document. References to the Cash
Offeror in this announcement should be construed accordingly.
The Scheme Document, forms of election to allow Virgin Mobile
Shareholders to elect to receive either of the Share Offer or the
Share and Cash Offer and proxy forms for the Meetings, will be sent
to Virgin Mobile Shareholders in due course. If Scheme Shareholders
do not elect, or do not validly elect for one of the Share
Alternative Offers, they will be deemed for the purposes of the
Scheme to have elected to receive the Cash Offer.
Fractional entitlements to ntl Shares will not be allotted or
issued pursuant to the Share Offer or the Share and Cash Offer and
will be disregarded.
ntl reserves the right to elect to implement the Offer by making a
Takeover Offer for the entire issued and to be issued share capital of
Virgin Mobile.
Prior to a Takeover Offer being made, the consent of the Panel will
be required and such alterations to the Offer will need to be made
as are necessary for the Takeover Offer to comply with the
provisions of the City Code, including those provisions relating to
the cash confirmation requirements of Rule 24.7.
ENQUIRIES:
NTL
Richard Williams Tel: +44 (0)20 7299 5479
BUCHANAN COMMUNICATIONS (PR Adviser to ntl)
Mark Edwards or Jeremy Garcia Tel: +44 (0)20 7466 5000
GOLDMAN SACHS (Financial Adviser to ntl)
Alain Carrier Tel: +44 (0)20 7774 1000
VIRGIN MOBILE
Steven Day or Mike Thomas Tel: +44 (0)20 7484 4300
MORGAN STANLEY & CO. LIMITED (Financial Adviser
to Virgin Mobile)
Justin Manson or Scott Bruckner Tel: +44 (0)20 7425 8000
INVESTEC BANK (UK) LIMITED (Corporate Broker to
Virgin Mobile)
Chris Godsmark Tel: +44 (0)20 7597 5051
JP MORGAN CAZENOVE (Corporate Broker to
Virgin Mobile)
Arjun Khullar Tel: +44 (0)20 7155 8642
FINSBURY (PR Adviser to Virgin Mobile)
James Murgatroyd or Don Hunter Tel: +44 (0)20 7251 3801
A conference call and webcast for analysts and investors regarding the
Offer will be held today at 2 p.m. UK time/ 9 a.m. Eastern Standard Time
(UK: +44 20 7365 8426, US: +1 617 597 5341, participant code: ntl). The
presentation can also be accessed live via webcast on ntl's website,
www.ntl.com/investors. The teleconference replay will be available for
one week beginning approximately two hours after the end of the call and
will be available until Tuesday, 11 April 2006. The dial-in replay
number for the US is: +1 617 801 6888 and the international dial-in
replay number is: +44 (0) 207 365 8427, participant code: 98450630.
A press conference will be held today at 12 p.m. UK time at the offices
of Buchanan Communications, 45 Moorfields, EC2Y 9AE.
This summary should be read in conjunction with the full text of the
attached announcement. The Offer will be subject to the conditions set
out in Appendix I to this announcement and the full conditions and
further terms which will be set out in the Scheme Document expected to
be issued shortly.
Appendix II contains the sources and bases of information used in this
announcement.
Appendix III contains further details on the Implementation Agreement.
Appendix IV contains the definitions of certain expressions used in this
announcement.
Goldman Sachs International, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting
exclusively for ntl and the Cash Offeror and no one else in connection
with the Offer and will not be responsible to anyone other than ntl and
the Cash Offeror for providing the protections afforded to its customers
or for providing advice in relation to the Offer or any matter or
arrangement referred to herein.
Morgan Stanley & Co. Limited is acting exclusively for Virgin Mobile and
no one else in connection with the Offer and will not be responsible to
anyone other than Virgin Mobile for providing the protections afforded
to its clients or for providing advice in relation to the Offer or any
matter or arrangement referred to herein.
Investec Bank (UK) Limited is acting exclusively for Virgin Mobile and
no one else in connection with the Offer and will not be responsible to
anyone other than Virgin Mobile for providing the protections afforded
to its clients or for providing advice in relation to the Offer or any
matter or arrangement referred to herein.
JP Morgan Cazenove is acting exclusively for Virgin Mobile and no one
else in connection with the Offer and will not be responsible to anyone
other than Virgin Mobile for providing the protections afforded to its
clients or for providing advice in relation to the Offer or any matter
or arrangement referred to herein.
FURTHER INFORMATION ON THE OFFER
The availability of the Offer to Virgin Mobile Shareholders who are not
resident in the United Kingdom and the United States may be affected by
the laws of relevant jurisdictions. Virgin Mobile Shareholders who are
not resident in the United Kingdom or the United States will need to
inform themselves about and observe any applicable requirements.
Any securities that are offered pursuant to the Offer described in this
announcement have not been and will not be registered under the
applicable securities laws of Australia, Canada or Japan. Accordingly,
any such securities may not be offered, sold or delivered, directly or
indirectly, in or into Australia, Canada or Japan except pursuant to
exemptions from applicable requirements of such jurisdictions.
The Offer will be subject to the applicable rules and regulations of the
UKLA, the London Stock Exchange and the City Code. In addition, the
Offer will be subject to the applicable requirements of the United
States federal and state securities laws and the applicable rules and
regulations of NASDAQ (except to the extent exempt from such
requirements).
Virgin Mobile Shareholders should read any prospectus that may be filed
by ntl with the SEC, because any such prospectus will contain important
information. Investors may obtain a free copy of any prospectus, if and
when it becomes available, and other documents filed by ntl Incorporated
with the SEC, at the SEC's website at http://www.sec.gov. Free copies of
any prospectus, if and when it becomes available, may be obtained by
directing a request to ntl Incorporated, 9098 Third Avenue, Suite 2863,
New York, New York 10022, Attention: Investor Relations. If the offer
proceeds by way of scheme of arrangement, however, it is anticipated
that no prospectus would be required because the transaction would be
exempt from registration under the US Securities Act of 1933, as
amended, pursuant to section 3(a)(10) thereof, in which case this fact
will be disclosed in the scheme document sent to all Virgin Mobile
Shareholders.
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy securities, or the solicitation of any
vote or approval, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of such
jurisdiction.
CITY CODE
Under the provisions of Rule 8.3 of the City Code, if any person is, or
becomes, "interested" (directly or indirectly) in 1 per cent. or more of
any class of "relevant securities" of ntl, the Cash Offeror or of Virgin
Mobile, all "dealings" in any "relevant securities" of that company
(including by means of an option in respect of, or a derivative
referenced to, any such "relevant securities") must be publicly
disclosed by no later than 3.30 p.m. (London time) on the Business Day
following the date of the relevant transaction. This requirement will
continue until the date on which the offer becomes, or is declared,
unconditional as to acceptances, lapses or is otherwise withdrawn or on
which the "offer period" otherwise ends. If two or more persons act
together pursuant to an agreement or understanding, whether formal or
informal, to acquire an "interest" in "relevant securities" of ntl, the
Cash Offeror or Virgin Mobile, they will be deemed to be a single person
for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the
City Code, all "dealings" in "relevant securities" of ntl, the Cash
Offeror or of Virgin Mobile by ntl, the Cash Offeror, or Virgin Mobile,
or by any of their respective "associates", must be disclosed by no
later than 12.00 noon (London time) on the Business Day following the
date of the relevant transaction. A disclosure table, giving details of
the companies in whose "relevant securities" "dealings" should be
disclosed, and the number of such securities in issue, can be found on
the Panel's website at www.thetakeoverpanel.org.uk. "Interests in
securities" arise, in summary, when a person has long economic exposure,
whether conditional or absolute, to changes in price of securities. In
particular, a person will be treated as having an "interest" by virtue
of the ownership or control of securities, or by virtue of any option in
respect of, or derivative referenced to, securities. Terms in quotation
marks are defined in the City Code, which can also be found on the
Panel's website. If you are in any doubt as to whether or not you are
required to disclose a "dealing" under Rule 8, you should consult the
Panel.
FORWARD LOOKING STATEMENTS
Certain statements in this document regarding the proposed transaction
between ntl Incorporated and Virgin Mobile Holdings UK plc, the expected
timetable for completing the transaction, future financial and operating
results, benefits and synergies of the transaction, future opportunities
for the combined company and products and any other statements regarding
Virgin Mobile 's or ntl's future expectations, beliefs, goals or
prospects constitute forward-looking statements as that term is defined
in the U.S. Private Securities Litigation Reform Act of 1995. When used
in this document, the words "believe", "anticipate", "should", "intend",
"plan", "will", "expects", "estimates", "projects", "positioned",
"strategy", and similar expressions or statements that are not
historical facts, in each case as they relate to ntl and Virgin Mobile,
the management of either such company or the proposed transaction, are
intended to identify those expressions or statements as forward-looking
statements. In addition to the risks and uncertainties noted in this
document, there are certain factors, risks and uncertainties that could
cause actual results to differ materially from those anticipated by some
of the statements made, many of which are beyond the control of ntl and
Virgin Mobile. These include: (1) the failure to obtain and retain
expected synergies from the integration of legacy ntl and legacy
Telewest Global and the proposed transaction, (2) rates of success in
executing, managing and integrating key acquisitions, including the
integration of legacy ntl and legacy Telewest Global and the proposed
acquisition, (3) the ability to achieve business plans for the combined
company, (4) the ability to manage and maintain key customer
relationships, (5) delays in obtaining, or adverse conditions contained
in, any regulatory or third-party approvals in connection with the
proposed acquisition, (6) availability and cost of capital, (7) the
ability to manage regulatory, tax and legal matters, and to resolve
pending matters within current estimates, (8) other similar factors, and
(9) the risk factors summarized and explained in the 2005 Form 10-K for
NTL Holdings Inc. (fka NTL Incorporated). For additional information
concerning factors that could cause actual results to materially differ
from those projected herein, please refer to ntl's and NTL holdings
Inc.'s most recent Form 10-K, 10-Q and 8-K reports.
APPENDIX I
CONDITIONS AND FURTHER TERMS OF THE OFFER
1. CONDITIONS OF THE OFFER
The Offer will be subject to the conditions set out herein and to
the further terms and conditions set out in the Scheme Document.
1.1 The Offer, if it is implemented by way of the Scheme, will be
conditional upon the Scheme becoming unconditional and effective,
subject to the City Code, by not later than 15 August 2006 or such
later date as ntl, the Cash Offeror, Virgin Mobile and the Court
may agree in writing.
The Scheme will be conditional upon:
(a) approval by a majority in number representing three fourths or
more in value of the holders of Scheme Shares, present and
voting, either in person or by proxy, at the Court Meeting;
(b) any resolution required to implement the Scheme, amend Virgin
Mobile's articles of association, and set out in the notice of
Extraordinary General Meeting, being passed at the
Extraordinary General Meeting; and
(c) the sanction of the Scheme (without modification or with
modification(s) agreed by Virgin Mobile and ntl) and the
confirmation of any reduction of capital involved therein by
the Court and an office copy of the Court order and the minute
of such reduction attached thereto being delivered for
registration to the Registrar of Companies of England and
Wales and, in relation to the reduction of capital, being
registered by him.
1.2 The Offer will also be subject to the Office of Fair Trading
indicating in terms satisfactory to the Cash Offeror or ntl that it
does not intend to refer the proposed acquisition of Virgin Mobile
by the ntl Group to the Competition Commission and, in the event
that the Secretary of State serves an intervention notice under
section 42(2) of the Enterprise Act 2002, the Office of Fair
Trading indicating in terms satisfactory to the Cash Offeror or ntl
that the Secretary of State does not intend to refer the proposed
acquisition of Virgin Mobile by the ntl Group to the Competition
Commission and the expiry of a period of four weeks from the date
on which the reasoned decision of the Office of Fair Trading or the
Secretary of State, as the case may be, was published, provided
that the Registry of the Competition Appeal Tribunal has confirmed
that, as at 5.00 pm on the final day of the four week period, no
application under section 120 of the Enterprise Act 2002 has been
made for review of the decision.
1.3 The Offer will also be conditional on approval of the Brand Licence
by a simple majority of the Independent Virgin Mobile Shareholders
voting, in person or by proxy, on a poll.
The Cash Offeror and/or ntl reserves the right to waive condition 1.2
above in whole or part.
If ntl or a member of the ntl Group is required by the Panel to make an
offer for Virgin Mobile Shares under the provisions of Rule 9 of the
Code, ntl or the relevant member of the ntl Group may make such
alterations to the conditions as are necessary to comply with the
provisions of that Rule, including (without limitation) an acceptance
condition of 70 per cent. of the Virgin Mobile Shares to which the
Takeover Offer relates.
If ntl or a member of the ntl Group elects to implement the Offer by
making a Takeover Offer for Virgin Mobile instead of or in substitution
for the Scheme, ntl or the relevant member of the ntl Group may, with
the consent of the Panel, make such alterations to the conditions as are
necessary to comply with the provisions of the Code.
The Offer will lapse if the Offer is referred to the Competition
Commission before the Effective Date.
The Offer and the Scheme will be governed by English law. The City Code
applies to the Offer.
2. CERTAIN FURTHER TERMS OF THE OFFER
(a) Virgin Mobile Shares will be acquired by the appropriate
members of the ntl Group fully paid and free from all liens,
equitable interests, charges, encumbrances and other third
party rights of any nature whatsoever and together with all
rights attaching to them, including the right to receive and
retain all dividends and distributions (if any) declared, made
or payable after the date of this announcement.
(b) The Offer will be on the terms and will be subject, inter
alia, to the conditions which are set out in paragraphs 1.1 to
1.3 of Appendix I and those terms which will be set out in the
Scheme Document and such further terms as may be required to
comply with the Listing Rules of the UK Listing Authority, the
obligations under the U.S. federal securities laws and the
regulations thereunder of the SEC and the provisions of the
City Code.
APPENDIX II
BASES OF CALCULATION AND SOURCES OF INFORMATION
1. The value placed by the Offer on the existing issued share capital,
and other statements made by reference to the existing share
capital, of Virgin Mobile are based on 258,703,010 Virgin Mobile
Shares in issue, being the number of shares in issue publicly
stated by Virgin Mobile on 29 March 2006.
2. With the consent of the Panel, the provisions of Rule 24.2(g) have
been applied as if the current offer period for Virgin Mobile
commenced on 5 December 2005, notwithstanding the fact that the
initial offer period ceased on 8 December 2005 and the current
offer period commenced on 9 December 2005.
3. Unless otherwise stated, the financial information and other
information on Virgin Mobile included in this announcement has been
extracted or derived, without material adjustment, from the audited
consolidated financial statements, for the Virgin Mobile Group for
the years ended 31 March 2004 and 2005, and the interim unaudited
consolidated financial results for the Virgin Mobile Group for the
six months ended 30 September 2004 and 2005.
4. Unless otherwise stated, the financial information and other
information on Telewest, the Cash Offeror and ntl included in this
announcement has been extracted or derived, without material
adjustment, from the audited consolidated financial statements for
the ntl Group and Telewest for the year ended 31 December 2004 and
2005.
5. Unless otherwise stated, all historic share prices quoted for
Virgin Mobile Shares have been sourced from the Daily Official List
and represent closing middle market prices for Virgin Mobile Shares
on the relevant dates.
6. As at the close of business on 3 April 2006, Virgin Mobile had in
issue 258,703,010 ordinary shares of 10 pence each.
7. As at the close of business on 3 April 2006, ntl had in issue
288,115,064 shares of common stock of US$0.01 each.
8. As at the close of business on 3 April 2006, the Cash Offeror had in
issue 121,006 ordinary shares of (pound)0.001 each.
9. The US$/(pound) exchange rate used in this announcement is the Federal
Reserve Bank of New York rate as at 12 p.m. New York time on 3 April
2006, being US$1.7389:(pound)1.
10. The ntl Share price used in this announcement is the closing price as
at 3 April 2006, being US$29.12.
APPENDIX III
IMPLEMENTATION AGREEMENT
Under the Implementation Agreement:
(a) Virgin Mobile, ntl and the Cash Offeror have given each other
certain undertakings regarding implementation of the Scheme
(or, if applicable, a takeover offer);
(b) Virgin Mobile, ntl and the Cash Offeror have agreed to
co-operate with each other towards satisfaction of the
Conditions;
(c) Virgin Mobile has agreed to the following provisions, breach
of which will be regarded as material and thereby giving ntl
the right to terminate the Implementation Agreement:
(i) to carry on the business of Virgin Mobile in the ordinary
course and not undertake any material commitment or enter
into or amend any material contract otherwise than in the
ordinary course;
(ii) not to amend or agree to amend the TSA other than
pursuant to the Amendment Agreement;
(iii) not to solicit an alternative offer for Virgin Mobile
and to promptly inform ntl and the Cash Offeror of any
such approach by a third party; and
(iv) not to take any action which is prejudicial to the
successful outcome of the Scheme; and
(d) Virgin Mobile has agreed that if the Scheme does not become
effective for any reason, including, for example, if the
requisite resolutions to approve the Scheme are not passed or
if the Court fails to sanction the Scheme, it will take or
cause to take all actions necessary to implement the Offer as
a Takeover Offer including providing Virgin Mobile's
recommendation to the implementation of the Offer as a
Takeover Offer pursuant to the note on Rules 35.1 and 35.2 of
the City Code.
APPENDIX IV
DEFINITIONS
The following definitions apply throughout this announcement unless the context
otherwise requires:
"AMENDMENT AGREEMENT" means the amendment agreement between Virgin
Mobile Telecoms Limited and T-Mobile (UK) Limited
dated on or about the date of this announcement in
respect of the amendment of certain provisions of
the TSA;
"ARPU" means average revenue per user;
"ASSOCIATED UNDERTAKING" has the meaning given to it in Section 20 of
Schedule 4A to the Companies Act;
"AUSTRALIA" means the Commonwealth of Australia, its
territories and possessions;
"BRAND LICENCE" means the trade mark licence agreement in respect
of the Virgin brand executed by Virgin Enterprises
and ntl on 3 April 2006;
"BUSINESS DAY" means a day (other than Saturday or Sunday) on
which banks are generally open for business in the
City of London;
"CANADA" means Canada, its provinces and territories and
all areas subject to its jurisdiction and any
political sub-division of such territories and
areas;
"CASH OFFER" means the recommended cash offer at the Offer
Price made to Scheme Shareholders by the Cash
Offeror (or such other member of the ntl Group who
shall be specified);
"CITY CODE" means the City Code on Takeovers and Mergers;
"CLOSING PRICE" means the middle market price of a Virgin Mobile
Share at the close of business on the day to which
such price relates, derived from the Daily
Official List for that day;
"COMPANIES ACT" means the Companies Act 1985 (as amended);
"CONDITIONS" means the conditions of the Offer set out in
Appendix I to this Announcement and any other
conditions which are agreed in writing by the
parties;
"COURT" means the High Court of Justice in England and
Wales;
"COURT MEETING" means the meeting of the Scheme Shareholders (and
any adjournment thereof) to be convened by order
of the Court pursuant to section 425 of the
Companies Act to consider and, if thought fit,
approve the Scheme (with or without amendment);
"COURT ORDER" means the order of the Court sanctioning the
Scheme under section 425 of the Companies Act and
confirming the reduction of share capital which
forms part of it under section 137 of the
Companies Act;
"DAILY OFFICIAL LIST" means the daily official list of the London Stock
Exchange;
"EFFECTIVE DATE" means the date on which the Scheme becomes
effective in accordance with its terms;
"EXTRAORDINARY GENERAL means the extraordinary general meeting (or any
MEETING" adjournment thereof) of the Virgin Mobile
Shareholders to be convened in connection with the
Scheme, expected to be held as soon as the
preceding Court Meeting shall have been concluded
or adjourned;
"FINANCIAL SERVICES means the Financial Services Authority of the UK
AUTHORITY" in its capacity as the competent authority for the
purposes of Part VI of FSMA and in the exercise of
its functions in respect of admission to the
Official List otherwise than in accordance with
Part VI of FSMA;
"FSMA" means the Financial Services and Markets Act 2000
(as amended);
"HEARING" means the hearing or hearings by the Court of the
petition to sanction the Scheme and/or confirm the
associated reduction of capital and/or grant the
Court Order (as the case may be);
"HEARING DATE" means the date of the commencement of the Hearing;
"IMPLEMENTATION AGREEMENT" means the implementation agreement between Virgin
Mobile, the Cash Offeror and ntl dated 3 April
2006;
"INDEPENDENT BOARD" means the directors of Virgin Mobile excluding
Gordon McCallum, who is the representative of
Virgin, Virgin Mobile's majority shareholder and
who has absented himself from discussions in
relation to the Offer;
"INDEPENDENT VIRGIN MOBILE means the Virgin Mobile Shareholders excluding the
SHAREHOLDERS" Virgin Group;
"INVESTMENT AGREEMENT" means the investment agreement between a member of
the Virgin Group, Sir Richard Branson, and ntl,
dated 3 April 2006;
"LISTING RULES" means the listing rules of the Financial Services
Authority;
"LONDON STOCK EXCHANGE" means London Stock Exchange plc;
"MEETINGS" means the Court Meeting and/or the Extraordinary
General Meeting, as the case may be;
"MORGAN STANLEY" means Morgan Stanley & Co. Limited;
"NASDAQ NATIONAL MARKET" means the national association of securities
dealers, automated quotation system national
market;
"NTL GROUP" means ntl, its holding companies and its
subsidiary undertakings;
"NTL SHARES" means ntl common stock of $0.01 per share which is
quoted on Nasdaq;
"NEW NTL SHARES" means new ntl Shares issued to Scheme Shareholders
who elect to receive ntl Shares pursuant to the
Share Offer or the Share and Cash Offer;
"OFFER" means the Cash Offer, the Share Offer, and the
Share and Cash Offer to acquire the Scheme Shares
as detailed in this Announcement and, where the
context requires, any subsequent revision,
variation, extension or renewal thereof;
"OFFER PRICE" means the cash offer price of 372 pence per Scheme
Share;
"OFFICIAL LIST" means the official list of the Financial Services
Authority;
"OVERSEAS SHAREHOLDERS" means Virgin Mobile shareholders whose registered
addresses are outside the UK and the United States
or who are citizens or residents of countries
other than the UK and the United States;
"(POUND)" means pounds sterling;
"PANEL" means The Panel on Takeovers and Mergers;
"QUAD-PLAY" means fixed line telephony, broadband internet,
television and mobile telephony;
"RGUS" means revenue generating units;
"SCHEME DOCUMENT" means the document proposed to be despatched by
Virgin Mobile to Virgin Mobile Shareholders
containing and setting out the terms and
conditions of the Offer and certain information
about Virgin Mobile, ntl and the Cash Offeror and
containing the Scheme and notices of the Meetings;
"SCHEME" OR "SCHEME OF means the proposed scheme of arrangement under
ARRANGEMENT" section 425 of the Companies Act between Virgin
Mobile and the holders of Scheme Shares, with or
subject to any modification, addition or condition
approved or imposed by the Court;
"SCHEME RECORD TIME" means the time and date to be specified in the
Scheme Document;
"SCHEME SHAREHOLDERS" means the holders of Scheme Shares;
"SCHEME SHARES" means Virgin Mobile Shares in issue on the date of
this announcement together with any further Virgin
Mobile Shares:
(a) issued after the date of this announcement
and prior to the Voting Record Time; and
(b) (if any) issued on or after the Voting Record
Time and prior to 6:00 p.m. on the day before
the Hearing Date either on terms that the
original or any subsequent holders thereof
shall be bound by the Scheme or in respect of
which the holders thereof shall have agreed
to be bound by the Scheme;
"SEC" means the U.S. Securities Exchange Commission;
"SECURITIES ACT" means the United States Securities Act of 1933 (as
amended);
"SHARE ALTERNATIVE OFFERS" means the Share and Cash Offer and/or the Share
Offer;
"SHARE AND CASH OFFER" means the recommended offer of 0.18596 ntl Shares
plus 67 pence in cash per Scheme Share held to
made by ntl and the Cash Offeror (or such other
member(s) of the ntl Group who shall be
specified);
"SHARE OFFER" means the recommended offer of 0.23245 ntl Shares
per Scheme Share held to made by ntl;
"SUBSIDIARY" or "SUBSIDIARY having the meanings given to them by the Companies
UNDERTAKING" Act;
"TAKEOVER OFFER" means the implementation of the Offer by means of
a takeover offer under the City Code;
"TELEWEST" means Telewest Global, Inc.;
"T-MOBILE" means T-Mobile (UK) Limited;
"TRIPLE-PLAY" means fixed line telephony, broadband internet,
and television;
"TSA" means the telecommunications supply agreement
between Virgin Mobile Telecoms Limited and
T-Mobile dated 29 January 2004;
"UKLA" means the United Kingdom Listing Authority;
"UNITED KINGDOM" or "UK" means the United Kingdom of Great Britain and
Northern Ireland;
"UNITED STATES" or "US" means the United States of America (including the
States and the District of Columbia), its
territories, its possessions and other areas
subject to its jurisdiction;
"US PERSON" means a US person as defined in Regulation S under
the Securities Act;
"US$" "USD" or "$" means United States dollars;
"VOTING RECORD TIME" means the time and date to be specified in the
Scheme Document;
"VIRGIN ENTERPRISES" means Virgin Enterprises Limited;
"VIRGIN GROUP" means Virgin Group Investments Limited and its
subsidiary undertakings and affiliates;
"VIRGIN MOBILE BOARD" means the full board of directors of Virgin
Mobile;
means Virgin Mobile and its subsidiary
"VIRGIN MOBILE GROUP" undertakings;
"VIRGIN MOBILE SHARE means (i) the Discretionary Share Option Plan;
OPTION SCHEMES" (ii) the Share Incentive Plan; (iii) the Savings
Related Share Option Plan; (iv) the Performance
Share Plan; and (v) the Pre-IPO Plan;
"VIRGIN MOBILE SHAREHOLDERS" means the holders of Virgin Mobile Shares; and
"VIRGIN MOBILE SHARES" means the ordinary shares of 10p each in Virgin
Mobile.