EXHIBIT 99.1
FOR IMMEDIATE RELEASE
NTL INCORPORATED ANNOUNCES ACQUISITION
OF COMTEL LTD
COMTEL SHAREHOLDERS TO RECEIVE CASH AND PREFERRED STOCK
New York, New York (June 16, 1998) - NTL Incorporated (NASDAQ: NTLI; EASDAQ:
NTLI.ED) announced today that it had entered into an acquisition agreement (the
"ComTel Agreement") with Vision Networks III B.V., a wholly owned subsidiary of
Royal PTT Nederland NV (KPN), for the acquisition of the operations of ComTel
Limited and Telecential Communications (collectively, "ComTel").
Under the ComTel Agreement, NTL will acquire ComTel for a total of 550 million
pounds sterling in two stages. In the first stage, NTL has acquired certain of
the ComTel properties for consideration of 275 million pounds sterling in cash;
in the second stage, upon the completion of certain corporate reorganizations
within ComTel, NTL will acquire the remaining ComTel properties for 200 million
pounds sterling in cash and 75 million pounds sterling in a new NTL PIK
Preferred Stock (the "Preferred Stock"). The Preferred Stock will have a
pay-in-kind coupon of 9.9%, will mature in 2008, and is redeemable within 15
months for common stock valued at market, new NTL convertible preferred
securities, or cash.
NTL has financed the cash portion of the first stage of the transaction through
a loan facility, completed through an amendment to NTL's existing bank facility
with the Chase Manhattan Bank. At the time of the transaction, ComTel will not
have any outstanding indebtedness.
Commenting on the transaction, J. Barclay Knapp, President and Chief Executive
Officer, said: "We are delighted to announce this significant transaction. With
the addition of ComTel and Comcast UK's 100%-owned operations, we will have
nearly 4 million franchise homes, more than 650,000 customers and nearly 60,000
business lines. ComTel's franchises are directly adjacent to our Suburban London
franchises in Hertfordshire/Bedfordshire and Surrey/Hampshire, and have more
than 1.1 million homes and more than 500 million pounds sterling in network
investment. We look forward to working with their customers, employees and
suppliers going forward."
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PRO FORMA OPERATING STATISTICS
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CURRENT PRO FORMA
NTL NTL (1)
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Franchise homes 2,090,000 3,952,000
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Homes marketed (ResTel) 887,400 1,972,000
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Homes marketed (CATV) 887,400 2,185,000
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Res. Telephony subscribers/lines 337,800 668,000
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Res. Tel. Penetration 38% 34%
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CATV Subscribers 341,900 611,000
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CATV penetration 39% 28%
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Business Subscribers 8,100 16,000
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Business Lines 31,000 57,000
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Annualized Q1 Revenues (mm) $590 $850
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Annualized Q1 EBITDA (mm) $55 $76
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P,P&E (mm) (2) $2,100 $3,500
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(1) Pro forma for the acquisition of ComTel and Comcast UK's 100%-owned
franchises. Data as of March 31, 1998. Data includes approximately 200,000
ComTel CATV-only homes passed which are subject to new build; the remaining
ComTel homes are comparable to the homes passed by NTL's existing dual
network.
(2) Includes approximately $500 million in P,P&E related to NTL's national
telecoms and broadcast businesses.
Completion of the second stage of the transaction is subject to certain closing
conditions. NTL assumes management control over all ComTel franchises effective
immediately.
ComTel operates telephony/cable networks in the United Kingdom. ComTel's
franchises cover approximately 1.1 million homes and are located in the Midlands
and South East England regions, covering areas including: Oxford, Swindon,
Coventry and Stratford. As of March 31, 1998, ComTel had passed approximately
991,000 homes, and had more than 161,000 residential telephony subscribers,
166,000 cable television subscribers and 2,600 business telephony subscribers.
NTL announces redemption of bonds:
- - ---------------------------------
The Company also announced today that it has provided to the Trustee of its 10
7/8% Senior Deferred Coupon Notes due 2003 (the "Notes") a notice that it will
redeem the Notes on October 15, 1998. Pending such redemption, the Company has
deposited in trust with the Trustee an amount equal to $218,586,840 to pay the
redemption price (including principal) on the Notes, thereby defeasing certain
of its obligations under the indenture governing the Notes.
NTL Incorporated is a leading alternative telecommunications company in the
United Kingdom. The Company owns and operates one of only five independent
national telecoms networks in the UK, and offers national business telecoms,
national and international carrier telecommunications services, and satellite
and radio communications services. Through its local telecoms division, the
Company offers residential telephony, residential cable television and Internet
services over advanced broadband fiber networks in six major franchise areas in
the UK. The Company's broadcast services division operates a national broadcast
transmission network of more than 1,200 owned and shared transmission sites, and
offers digital and analog broadcast transmission services to major television
and radio stations nationwide in the UK.
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For further information contact: In the U.S.: John F. Gregg, Managing Director -
Corporate Development, Michael A. Peterson, Director - Corporate Development or
Richard J. Lubasch, Senior Vice President - General Counsel at (212) 906-8440;
in the UK: Bret Richter, Director - Corporate Development at (0171) 227-8700 or
Alison Smith, Group Communications at (01252) 402662; or via e-mail at
investor_relations@NTLI.com.