The Virgin Bride

Liberty Global, the business of pioneering US cable guy John Malone, is readying a bid for Virgin Media, expected to value the UK-focused broadband business at more than $20 billion.

This is a consolidation play in a market that lends itself to gigantism. Liberty Global is an active cabler of continental European markets. But it spools no fiber in the UK. Virgin Media is the inheritor of the top-notch UK network created by NTL. This over-leveraged business crashed into Chapter 11 protection in 2002, and combined with erstwhile deadly rival Telewest in 2006. Plug in Virgin Media and Liberty Global’s European proposition is instantly more compelling. But shareholders in the group are far from being distressed sellers. Since incoming chief executive Neil Berkett prioritized fast broadband in 2008, a total shareholder return of 170 per cent has outstripped payback generated by competitors British Sky Broadcasting and TalkTalk, according to S&P Capital IQ statistics.